>f  California 

Regional 

Facility 


1890 


UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 


SCHOOL  OF  LAW 
LIBRARY 


"Gold  is  a  wonderful  clearer  of  the  understanding;  it  dissipates  every  doubt 
and  scruple  in  an  instant,  accommodates  itself  to  the  meanest  capacities,  silences 
the  loud  and  clamorous  and  brings  over  the  most  obstinate  and  inflexible.  Philip 
of  Macedoii  refuted  by  it  all  the  wisdom  of  Athens,  confounded  their  statesmen, 
•track  their  orators  dumb,  and  at  length  argued  them  out  of  their  liberties." 

— ADDJSOJT. 


SPEECH 


OF 


HON.  JOHN  P.  JONES, 


OF    NEVADA, 


ON  THE  FREE  COINAGE  OF  SILVER; 


UNITED    STATES    SENATE, 

MAY  12  AND  J3,  1800. 


WASHINGTON. 

1890. 


': 

I 

•-• 


SPEECH 

or 

HON.    JOHN    P.    JONES, 

OF    NEVADA, 

On  the  bill  (S.  2350)  authorizing  the  issue  of  Treasury  notes  on  deposits  of  silver 

bullion. 

Mr.  JONES,  of  Nevada,  said : 

Mr.  PRESIDENT  :  The  question  now  about  to  be  discussed  by  thia 
body  is  in  my  judgment  the  most  important  that  has  attracted  the 
attention  of  Congress  or  the  country  since  the  formation  of  the  Con- 
stitution. It  affects  every  interest,  great  and  small,  from  the  slightest 
concern  of  the  individual  to  the  largest  and  most  comprehensive 
interest  of  the  nation. 

The  measure  under  consideration  was  reported  by  me  from  the 
Committee  on  Finance.  It  is  hardly  necessary  for  me  to  say,  how- 
ever, that  it  does  not  fully  reflect  my  individual  views  regarding 
the  relation  which  silver  should  bear  to  the  monetary  circulation  of 
the  country  or  of  the  world.  I  am,  at  all  times  and  in  all  places,  a 
firm  and  unwavering  advocate  of  the  free  and  unlimited  coinage  of 
silver,  not  merely  for  the  reason  that  silver  is  as  ancient  and  honor- 
able a  money  metal  as  gold,  and  equally  well  adapted  for  the  money 
use,  but  for*  the  further  reason  that,  looking  at  the  annual  yield 
from  the  mines,  the  entire  supply  that  can  come  to  the  mints  will  at 
no  time  be  more  than  is  needed  to  maintain  at  a  steady  level  the 
prices  of  commodities  among  a  constantly  increasing  population. 

In  view,  however,  of  the  great  divergency  of  views  prevailing  on 
the  subject,  the  length  of  time  which  it  was  believed  might  be  con- 
sumed in  the  endeavor  to  secure  that  full  and  rightful  measure  of  leg- 
islation to  which  the  people  are  entitled,  and  the  possibility  that 
this  session  of  Congress  might  terminate  without  affording  the  coun- 
try some  measure  of  substantial  relief,  I  was  willing,  rather  than 
have  the  country  longer  subjected  to  the  baleful  and  benumbing  in- 
fluences set  in  motion  by  the  demonetization  act  of  1873,  to  join  with 
other  members  of  the  Finance  Committee  in  reporting  the  bill  now 
under  consideration. 

Under  the  circumstances  I  wish  at  the  outset  of  the  discussion  to 
say  that  I  hold  myself  free  to  vote  for  any  amendment  that  may  be 
offered  that  may  tend  to  make  the  bill  a  more  perfect  measure  of  re- 
lief, and  that  may  be  more  in  consonance  with  my  individual  views. 

THE  CONDITION  OF  THI  COUNTRY. 

The  condition  of  this  country  to-day,  Mr.  President,  is  well  cal- 
culated to  awaken  the  interest  and  arouse  the  attention  of  thinking 
men.  It  can  be  safely  asserted  that  no  period  of  the  world's  history 
can  exhibit  a  people  at  once  so  numerous  and  homogeneous,  living 
under  one  form  of  government,  speaking  a  common  language,  enjoy- 
ing  the  same  degree  of  personal  and  political  liberty,  and  sharing,  in 
so  equal  a  degree,  the  same  civilization  as  the  population  of  the 


United  States.  Eminently  practical  and  ingenious,  of  indomitable 
will,  untiring  energy,  and  unfailing  hope;  lavoied  1>\  natuie  \vithu 
domain  of  iin pi-rial  expanse,  with  soil  and  climate  of  uiu-qualed  vari- 
ety and  beneficence,  with  every  natural  condition  that  can  conduce 
to  individual  prosperity  and  national  glory,  it  might  well 
that  among  such  a  people  industry,  agriculture,  commerce,  an.  ami 
science  would  reach  an  extent  and  perfection  of  development  sur- 
passing anything  ever  known  in  the  history  of  mankind. 

In  some  respects  this  expectation  would  appear  to  have  been  well 
founded.  For  several  years  past  our  farmers  have  produced  au 
annual  average  of  400,000,000  bushels  of  wheat.  Our  oat  crop  t'»r 
1888  was  700,000,000  bushels,  our  corn  crop  2,000,000,000  bushel*. 
our  cotton  crop  7,000,000  bales.  In  that  year  our  coal  mines  yielded 
170,000,000  tons  of  coal,  our  furnaces  produced  r,,;,00,000  tous  of  pig 
iron  and  3,000,000  tons  of  steel.  Our  gold  and  silver  mines  add  more 
than  $100,000,000  a  year  to  the  world's  stock  of  the  precious  n 
We  print  16,000  newspapers  ami  periodicals,  have  in  operation 
154,000  miles  of  railroad  and  250,000  miles  of  telegraph.  The  value 
of  our  manufactured  products  at  the  date  of  the  last  ceusr.  - 
$5.400,000,000.  Our  farm  lands  at  the  same  time  were  estimated  at 
$10,000,000,000,  our  cattle  at  $2,000,000,000,  our  railroads  at  $6,000,- 
000,000,  of  r  houses  at  $14,000,000,000.  It  is  not  too  much  to  say  that 
there  has  been  an  increase  of  folly  50  per  cent,  in  those  values  since 
the  taking  of  the  census  of  1--H).  Our  national  wealth  to-day  is 
reasonably  estimated  at  over  $60,000,000,000. 

Figures  and  facts  such  as  these  in  the  history  of  a  young  nation 
k  the  presence  not  merely  of  great  natural  opportunities,  but 
oi  a  people  marvelously  apt  and  forceful.     From  such  results  should 
be  anticipated  the  highest   attainable    prosperity  and   hapi 
Our  population  is  alert,  aspiring,  and  buoyant,  not  given  t. 

>ining  or  aim  less  endeavor,  but,  with  fixity  of  purp 
ever  eagerly  on,  ulili/ing  every  conception  of  the  brain  to  supple- 
ment and  multiply  the  possibilities  of  the  hand,  and  at  every  turn 
•  .;i,ating  the  subtle  forces  of  nature  to  the  best  and  wisest  pur- 
poses of  man.  No  equal  numl>< T  of  persons  on  the  globe  better  de- 
serve success,  or  are  better  adapted  for  its  en jo\  m<  nt. 

But   instead  of  lindini:.  a.s  we  should  find,  happiness  and  content- 
ment broadcast  throughout   our  -jreat  domain,  there  are  heard  from 

•  n  in  this  Kepnlilic,  resoimdir. 

-faction.     Kvery  trade  ami  occupation  exhibits  sympt' 
ne-vs  and  distrust.     The   farmer,  t! 

all  share  in  the  general  complaint    that  time-,  are   hard,  that    InV.- 
D«M  is  "dull."     Tin-  farmer  is  in   debt,  and    is   not  realizing. 
products  of  his  labor,  the  wherewithal    to    meet    either   : 
or  his  current  obligations;   the  arti-.an, when  at    \\oik,  finds  1 

B  ivlativ  ••  or  friend  who  is 

Hit    who  hi]  \  -.  Ills  _; 1>    n: 

little  pr.'tit  in  .,a'ies,  and  difiicnlty  in  making  i  uts. 

WHAT  IB  THE   KIFFICL'LTr  f 

I'residen:  •  thus  brought  to  naught 

ttea  and  p  , 

•  •:' hiiiidredsof  thon- i  .•.•!!,  shrewd. 

:iU   men   / 

.head;   tin 

:  assets  am 
lie  found    : 
le  correct  - 


5 

ing  pay-day?  What  potent  and  sinister  drug  has  been  secretly 
introduced  into  the  veins  of  commerce  that  has  caused  the  blood  to 
flow  so  sluggishly — that  has  narcotized  the  commercial  and  indus- 
trial world  ? 

All  have  been  looking  for  the  cause,  and  many  think  they  have 
discovered  it.  With  some  it  is  "  over-production,"  with  others  either 
a  "high  tariff"  or  a  "tariff  not  sufficieatly  high."  Some  think  it 
due  to  trusts  and  combinations,  others  to  improved  methods  of  pro- 
duction, or  because  the  crops  are  overabundant  or  not  abundant 
enough.  Some  ascribe  the  difficulty  to  speculation;  others,  to 
"strikes."  All  sorts  of  insufficient  and  contradictory  causes  are 
assigned  for  the  same  general  and  universal  complaint.  However 
inadequate  in  themselves,  they  serve  to  emphasize  the  universal  rec- 
ognition of  a  difficulty  whose  cause  without  close  inquiry  is  likely 
to  elude  detection.  But  the  evil  is  of  such  magnitude,  it  is  so  wide- 
spread and  pervasive,  that,  without  a  knowledge  of  its  cause,  all 
effort  at  mitigation  of  its  effects  can  but  add  to  the  confusion  and 
intensify  the  difficulty. 

It  behooves  us,  therefore,  as  we  value  the  prosperity  and  happi- 
ness of  our  people,  to  set  ourselves  diligently  to  the  inquiry  :  What 
is  the  cause  of  the  unrest  and  discontent  now  universally  prevailing! 

ONE  SYMPTOM  COMMON  TO  ALL  INDUSTRIES. 

In  surveying  the  question  broadly,  to  discover  whether  there  is 
anything  that  affects  the  situation  in  common  from  the  standpoint 
of  varying  occupations,  we  find  one,  and  only  one,  uniform  and  un- 
failing characteristic ;  the  prices  of  all  commodities  and  of  all  prop- 
erty, except  in  money  centers,  have  fallen,  and  continue  falling. 
Such  a  phenomenon  as  a  constant  and  progressive  fall  in  the  general 
range  of  prices  has  always  exercised  so  baleful  an  influence  on  the 
prosperity  of  mankind  that  it  never  fails  to  arrest  attention. 

History  gives  evidence  of  no  more  prolific  source  of  human  misery 
than  a  persistent  and  long  continued  fall  in  the  general  range  of 
prices.  But,  although  exercising  so  pernicious  an  influence,  it  is  not 
itself  a  cause,  but  an  effect. 

When  a  fall  of  prices  is  found  operating,  not  on  one  article  or  class 
of  articles  alone,  but  on  the  products  of  all  industries;,  when  found 
to  be  not  confined  to  any  one  climate,  country,  or  race  of  people,  but 
to  diffuse  itself  over  the  civilized  world  ;  when  it  is  found  not  to  .be 
a  characteristic  of  any  one  year,  but  to  go  on  progressively  for  a 
series  of  years,  it  becomes  manifest  that  it  does  not  and  can  not  arise 
from  local,  temporary  or  subordinate  causes,  but  must  have  its  gen- 
esis and  development  in  some  principle  of  universal  application. 

WHAT  PRODUCES  A  GENERAL    FALL  OF  PRICES  t 

What,  then,  is  it  that  produces  a  general  decline  of  prices  in  any 
country?  It  is  produced  by  a  shrinkage  in  the  volume  of  money  . 
relatively  to  population  and  business,  which  has  never  yet  failed  to 
cause  an  increase  in  the  value  of  the  money  unit,  and  a  consequent 
decrease  in  the  price  of  the  commodities  for  which  such  unit  is  ex- 
changed. If  the  volume  of  money  in  circulation  be  made  to  bear  a  di- 
rect and  steady  ratio  to  population  and  business,  prices  will  be  main- 
tained at  a  steady  level,  and,  what  is  of  supreme  importance,  money 
will  be  kept  of  unchanging  value.  With  an  advancing  civilization, 
in  which  a  large  volume  of  business  is  conducted  on  a  basis  of  credit 
extending  over  long  periods,  it  is  of  the  uttermost  importance  that 
money,  which  is  the  measure  of  all  equities,  should  be  kept  unchang- 
ing in  value  through  time. 


6 

BKFECT  OF    A  BKDUCTIO5  »  TBI  MOXKY  VOl.UMK. 

A  redaction  in  the  volume  of  money  relatively  to  population  and 
business,  or,  (to  state  the  proposition  in  another  form)  a  volume 
•which  remains  stationary  while  population  and  business  are  increas- 
ing, has  the  effect  of  increasing  tne  value  of  each  unit  of  mouc\ ,  I  •>• 
increasing  its  purchasing  power. 

It  is  only  within  a  comparatively  recent  period  that  an  increasing 
value  in  the  money  unit  could  produce  such  widespread  disturbance 
of  industy  as  it  produces  to-day.  In  the  rude  periods  of  society 
commerce  was  by  barter ;  ami  even  for  thousands  of  years  after  the 
introduction  of  money,  credit,  where  known  at  all.  W«l  extremely 
limited.  Under  such  circumstances  changes  in  the  volume  and  in 
the  value  of  money,  while  operating  to  the  disadvantage  of  society 
as  a  whole,  could  not  instantly  or  seriously  atl'ei t  any  one  individual. 
An  increase  of  25  per  cent,  in  one  year  in  the  value  of  the  moi.ey 
unit — a  change  which  now,  by  reason  of  existing  contracts  and 
debts,  would  entail  universal  bankruptcy  and  ruin — would  not  lie 
•eriously  felt  by  a  community  in  which  no  such  contract*  or  debts 
existed,  in  which  payments  were  immediate  or  at  short  intervals. 
and  each  individual  parted  with  his  money  almost  as  sou: 
received  it. 

Such  proportion  of  the  annual  increase  in  the  value  of  the  money 
nnit  as  could  attach  to  any  one  month,  week,  or  day  would  be 
wholly  insignificant,  and  as  most  transactions  were  closed  on  the. 
spot,  no  appreciable  loss  could  accrue  to  any  individual.  Such  loss 
as  did  accrue  was  shared  in  and  averaged  among  the  whole  com- 
munity, making  it  the  veriest  trifle  upon  any  individual,  lint  how 
is  it  in  our  day  f 

THAT  KKFECT  1XTK38IF1KD  AS  CIVILIZATION   ADVANCES. 

The  inventions  of  the  past  one  hundred  years  have  established  a 
new  order  of  the  ages.  The  revolution  of  industry  and  commerce. 
effected  by  the  adaptation  of  steam  and  other  forces  of  nature  to  the 
uses  of  man,  have  given  to  civilization  an  impetus  exceeding  any- 
thing known  in  the  former  experience  of  mankind.  I'nder  the  opera- 
tion of  the  new  system,  the  rapidity  and  intensity  with  winch, 
within  that  period,  civilization  has  developed,  is  due  in  great  part 
to  an  economic  feature  unknown  to  ancient  c.ivili/.ation  and  pi.n  t.- 
cally  unknown  even  to  civilized  society  until  the  iiury. 

That  feature  is  the  time-contract,  l.\  \\  )m  h  alone  leading  minds  ax- 
enabled  to  project  in  advance  enterprise  ot  'magnitude  and  moment. 
It  is  only  through  intelligent  and  far-seeing  plans  and  projections 
that  in  a  complex  and  minutely  classified  -\-t.-m  of  inunstiy  great 
bodies  of  men  can  be  kept  in  uninterrupted  emplo\  meut. 

We  have 22,000,000  workmen  in  this  country.  In  order  that  they 
may  be  kept  uninterruptedly  employed  it  is  absolutely  necessary 
that  business  contracts  and  obligation- he  made  long  in  a<l\  ance. 
•i:uulyf  we  read  almost  daily  of  the  inception  of  industrial  un- 
dertakings requiring  yearn  to  fnl till.  It  is  not  too  much  to  say  that 
the  suspension  t»i  one  season  of  t  lie  making  of  time-,  on  tract  -  would 
clofe  the  factories,  furnaces,  and  machine  shops  of  all  civilized 

:  .itural  concomitant  of  such  a  system  of  indi.  elab- 

orate system  of  debt  and  credit  \vh  ich  ha«  grown  up  with  it.  and  i- 

•  -.il'le  t<>  it.     Any  serious  enhancement   in  the  value  o|  the 
••y  between  the  time  <  if  making  a   conn  act  or  incurring  a 

•:d  the  date  of  fulfillment  or  maturity    al\\  a\  H  works  h.,; 
and  frequently  ruin  to  the  contractor  or  debtor. 


Three-fourths  of  the  business  enterprises  of  this  country  are  con- 
ducted on  borrowed  capital.  Three-fourths  of  the  homes  and  farms 
that  stand  in  the  name  of  the  actual  occupants  have  been  bought 
on  time,  and  a  very  large  proportion  of  them  are  mortgaged  for  the 
payment  of  some  part  of  the  purchase- money. 

Under  the  operation  of  a  shrinkage  in  the  volume  of  money  this 
enormous  mass  of  borrowers,  at  the  maturity  of  their  respective  debts, 
though  nominally  paying  no  more  than  the  amount  borrowed,  with 
interest,  are,  in  reality,  in  the  amount  of  the  principal  alone,  return- 
ing a  percentage  of  value  greater  than  they  received — more  than  in 
equity  they  contracted  to  pay  and  oftentimes  more,  in  substance,  than 
they  profited  by  the  loan.  To  the  man  of  business  this  percentage 
in  many  cases  constitutes  the  difference  between  success  and  failure. 
Thus  a  shrinkage  in  the  volume  of  money  is  the  prolific  source  of 
bankruptcy  and  ruin.  It  is  the  canker  that,  unperceived  and  unsus- 
pected, is  eating  out  the  prosperity  of  our  people.  By  reason  of  the 
almost  universal  inattention  to  the  nature  and  functions  of  money 
this  evil  is  permitted,  unobserved,  to  work  widespread  ruin  and  dis- 
aster. So  subtle  is  it  in  its  operations  that  it  eludes  the  vigilance 
of  the  most  acute.  It  baffles  all  foresight  and  calculation ;  it  sets  at 
naught  all  industry,  all  energy,  all  enterprise. 

CONTRAST    OF  EFFECTS  PRODUCED    BY  AN    INCREASING   AXD  A  DECREASING  MONET- 

VOLUME. 

The  difference  in  the  effects  produced  by  an  increasing  and  a  d«^ 
creasing  money-volume  has  not  escaped  the  attention  of  observant 
writers. 

David  Hume,  in  his  Essay  on  Money,  says : 

It  is  certain  that  since  the  discovery  of  the  mines  in  America  industry  has  in- 
creased in  all  the  nations  of  Europe.  *  *  We  find  that  in  every  kingdom  into 
which  money  begins  to  flow  in  greater  abundance  than  formerly,  everything  takes 
a  new  face ;  labor  and  industry  "ain  life ;  the  merchant  becomes  more  enterprising, 
the  manufacturer  more  diligent  and  skillful,  and  even  the  farmer  follows  his  plow 
with  greater  alacrity  and  attention.  *  *  *  It  is  of  no  manner  of  consequence  with 
regard  to  the  domestic  happiness  of  a  state  whether  money  be  in  a  greater  or  less 
quantity.  The  good  policy  ot  the  magistrate  consistsonly  in  keeping  it,  if  possible, 
still  increasing;  because  by  that  means  he  keeps  alive  a  spirit  of  industry  in  the 
nation  and  increases  the  stock  of  labor,  in  which  consists  all  real  power  and  riches. 
A  nation  whose  money  decreases  is  actually  at  that  time  weaker  and  more  misera- 
ble than  another  nation  which  possesses  no  more  money,  but  is  on  the  increasing 
hand. 

William  H.  Crawford,  Secretary  of  the  Treasury,  in  a  report  to 
Congress,  dated  12th  February,  1820,  says: 

All  intelligent  writers  on  currency  agree  that  when  it  is  decreasing  in  amount 
poverty  and  misery  must  prevail. 

Mr.  R.  M.  T.  Hunter,  in  a  report  to  the  United  States  Senate 
in  1852,  says: 

Of  all  the  ereat  effects  produced  upon  human  society  by  the  discovery  of  America, 
there  were  probably  none  so  marked  as  those  brought  about  by  the  great  influx 
of  the  precious  metals  from  the  New  World  to  the  Old.  European  industry  had 
been  declining  under  the  decreasing  stock  of  'the  precious  metals-  and  an  appre- 
ciating standard  of  values  ;  human  injieuuity  grew  dull  under  the  paralyzing  in- 
fluences of  declining  profits,  and  capital  absorbed  nearly  all  that  should  have  been 
divided  between  it  and  labor.  But  an  increase  of  the  precious  metals,  in  such 
quantity  as  to  check  this  tendency,  operated  as  a  new  motive  power  to  the  machin- 
ery of  commerce.  Production  was  stimulated  by  finding  the  advantages  of  a 
change  in  the  standard  on  its  side.  Instead  of  being  repressed  by  having  to  pay 
more  than  it  had  stipulated  for  the  use  of  capital,  it  was  stimulated  by  paying 
less.  Capital,  too,  was  benefited,  for  new  demands  were  created  for  it  by  the 
new  uses  which  a  general  movement  in  industrial  pursuits  had  developed ;  so 
that  if  it  lost  a  little  by  a  change  in  the  standard,  it  gained  much  more  in  the 
greater  demand  for  its  use,  which  added  to  its  capacity  for  reproduction,  and  to 
to  its  real  value. 

The  mischief  would  be  great,  indeed,  if  all  th<j  -world  were  to  adopt  but  one  of 
JONES 


the  precious  metals  M  the  standard  of  value.  To  adopt  cold  alone  would  diminish 
the  specie  currency  more  than  one-half;  and  the  reduction  the  other  way.  should 
silver  be  taken  as  the  only  standard,  would  be  large  enough  to  prove  highly  disas- 
trous to  the  human  race. 

The  Encyclopaedia  Britannica,  1359  (article  Precious  Metals,  by  J. 
R.  McCulloch),  says: 

A  fall  in  the  value  of  the  precious  metals,  caused  by  the  greater  facility  of 
their  production,  or  by  the  discovery  of  new  sources  of  supply,  depends  in  no  de- 
gree on  the  theories  of  philosophers  or  the  decision  of  statesmen  or  legislators, 
out  is  the  result  of  circumstances  beyond  human  control ;  and  although,  like  a  fall 
of  rain  after  a  long  course  of  drv  weather,  it  may  be  prejudicial  to  certain  classes, 
it  is  beneficial  to  an  incomparably  greater  number,  including  all  who  are  engaged 
in  industrial  pursuits,  and  is,  speaking  generally,  of  great  public  or  national  ad 
vintage. 

Ernest  Seyd,  1868  (Bullion,  page 613),  says: 

Upon  this  one  point  all  authorities  on  the  subject  are  agreed,  to  wit,  that  the 
large  increase  in  the  supply  of  gold  ban  given  a  universal  impetus  to  trade,  com- 
merce, and  industry,  and  to  general  social  development  and  progrena. 

The  American  Review  (1876)  says: 

Diminishing  money  and  filling  prices  are  not  only  oppressive  upon  debtors,  of 
•whom,  in  modern  times,  states  are  the  greatest,  but  they  cause  stagnation  in  busi- 
ness, reduced  production,  and  enforced  idleness.  Falling  markets  annihilate  ;>:<>:' 
its,  and  as  it  is  only  the  expectation  of  gain  which  stimulates  the  investment  <>f 
capital  in  operations,  inadequate  employment  is  found  for  labor,  and  those  who  are 
•  employed  can  only  be  so  upon  tin-  condition  of  diminished  w;i_-.  s.  An  increasing 
amount  of  money,  and  consequently  augmenting  prices,  are  attended  by  results 
precisely  the  contrary.  Production  is  stimulated  by  the  profits  resulting  from 
advancing  prices  ;  labor  is  consequently  in  demand  and  better  paid,  and  the  gen- 
eral activity  and  buoyancy  insure  to  capital  a  wider  demand  and  higher  remunera- 
tion. 

PRICE  THE  IXDEX  OF  THE  VALUE  OF  HO.XET. 

There  can  be  no  truer  index  of  the  value  of  money  than  the  gen- 
eral range  of  prices.  Price  is  the  mercury  by  tin-  rine  and  fall  of 
vrbich-the  heat  and  struggle  °f  industrial  and  business  lilt-  *r»  daily 
measured  and  made  plain.  Where  the  tendency  of  iliis  indicator 
continue*  downward,  there  is  no  more  certain  sign  that  money  is  in- 
-injj  in  value. 

During  a  period  of  falling  prices  the  fear  of  impending  calamity 
hangs  like  a  pall  over  the  business  of  the  «ounti\ .  Notwithstand- 
ing unremitting  efforts,  men  feel  themselves  constantly  on  the  edge 
of  disaster.  Gloomy  foreboding  and  timidity  take  the  place  of  con- 
fidence and  courage. 

A  shrinking  volume  of  money  is  the  most  insidious  foe  with  which 
civilization  has  to  contend. 

It  is  my  firm  conviction  that  the  inexpressible  mivries  in:, 
upon  mankind  by  war,  pestilence,  and  famine  have  been  less  cruel, 
unpitying,  and  unrelenting  than  the  persistent  and  remorseless 
exactions  which  this  inexorable  enemy  has  made  upon  society.  As 
the  volume  of  money  contracts  prices  decline,  and  with  tin-  decline 
of  prices  comes  stagnation  of  industry,  and  tin-  relegation  t<>  idle- 
ness of  thousands  otwilling  workmen.  Capitalists  In-come  nnwill- 
<  invest  their  money  in  enterprises  that  employ  labor  while 
the  products  of  that  labor  are  constantly  decreasing  in  price.  During 
all  periods  of  falling  prices  therefore  money  capital  i*  withdrawn 
<  industry  and  seeks  investment  in  IMHMN  ami  othet 

of  money-futures  yielding  fixed  incomes.     For  although  the  ; 
interest    in  many  xuch  cases  may  be  low,  the  •  mpcn- 

sated  for  this  by  the  enhancement  in  the  pnn-haning  pov 
dollar  of  the  principal  and  l>y  the  necessarily  greater  command  it 
secure-  <>ver  the  products  of  labor. 


9 

Avoiding  the  very  purpose  for  which  it  was  devised,  money  at 
each  times  weeks  seclusion  and  declines  to  circulate.  Its  owner 
finds  that  he  can  better  afford  to  leave  it  idle  in  a  vault  or  bury  it  in, 
the  earth,  than  subject  it  to  the  probability  of  diminution  by  in- 
vesting it  in  business  on  a  constantly  falling  market.  Thus,  con- 
trary to  all  principles  of  progress  and  of  natural  justice,  the  man  who 
keeps  .his  money  idle,  and  deprives  society  of  its  use,  is  rewarded 
by  an  unearned  increment,  while  he  who  puts  his  money  into  active 
business,  where  industry  and  labor  may  profit  by  it  is  punished  by 
unmerited  loss. 

Under  such  conditions  it  is  impossible  for  a  community  to  reach 
that  degree  of  material  progress  which,  under  proper  circum- 
stances, it  would  readily  attain.  At  every  turn  distress  and  dis- 
couragement stare  the  people  in  the  face.  In  every  town  and  vil- 
lage men,  willing  to  work,  stand  idle.  Even  their  misfortune  does 
not  end  with  themselves,  for  not  only  are  they  a  tax  upon  their 
friends,  lessening  to  some  extent  the  meager  income  of  those  who 
give  them  temporary  assistance,  but  their  necessary  and  eager  com- 
petition for  the  little  work  that  offers,  tends  to  reduce  the  compensa- 
tion of  those  to  whom  they  are  thus  indebted.  Stores,  workshops, 
and  factories,  unoccupied  and  unused,  are  found  in  every  direction. 
Crime  increases,  bankruptcies  multiply,  and  even  though  the  ag- 
gregate of  wealth  augments,  it  is  unjustly  distributed,  and  conse- 
quently barren  of  beneficent  results. 

A  GLANCE  AT  THE  HISTORY  OF  MONET. 

The  system  of  relying  upon  the  precious  metals  as  money  has  long 
been  known  as  the  Automatic  system.  Accurately,  it  should  be 
called  the  Accidental  system.  It  has  been  called  "automatic"  be- 
cause, so  long  as  money  was  made  to  depend  solely  upon  the  yield 
of  the  niines,  the  supply  regulated  itself  by  what  was  believed  to  be 
a  natural  method,  namely,  by  the  expenditure  of  labor  in  its  pro- 
duction,  and  was  limited  only  by  the  rude  obstacles  which  nature 
opposes  to  the  production  of  the  metals.  The  necessity  of  expend- 
ing this  labor  placed  the  money  volume  of  any  country  beyond  the 
control  of  the  kings  and  conquerors  who,  in  the  primitive  periods  of 
society,  exercised  despotic  sway  over  their  subjects.  It  was  un- 
doubtedly better  for  the  people  of  those  early  times  to  risk  the 
accidents  of  production  than  the  follies  and  sinister  designs  of  rulers. 

This  automatic  system  grew  out  of  barter.  It  is  a  survival  from 
the  period  when  articles  were  exchanged  directly,  not  for  gold  and 
silver  as  money,  but  for  gold  and  silver  as  commodities — on  the  basis 
of  their  cost  of  production — as  in  the  case  of  the  articles  for  which 
they  were  exchanged. 

There  have  been  the  same  evolutions  of  progress  in  money  as  in 
all  other  things.  In  the  rude  original  of  society  no  kind  of  money 
was  possible.  The  first  trade  was  by  barter,  after  which,  some  one 
or  more  commodities  attainable  in  the  vicinage,  and  in  general  use 
and  demand  were  selected  as  the  common  media  through  which 
all  exchanges  were  filtered.  The  use  for  that  purpose  of  various 
metals  by  weight  followed  next,  and,  at  a  succeeding  stage,  gold, 
silver,  and  copper  by  weight,  and  after  this  their  use  in  the  form  of 
coins,  the  value  of  which  coincided  with  the  bullion-value,  which 
must  necessarily  be  the  case  when  free  coinage  is  permitted. 

It  may  be  not  uninteresting  in  this  connection  to  have  a  general 
view  of  the  materials  which,  at  different  epochs  of  the  world's  his- 
tory, have  been  used  as  money.  I  therefore  present  a  tabular  state- 
ment giving  those  particulars  in  chronological  order. 


10 


Table  showing  tome  of  the  substances  tchich  hare,  at  various  periods  and  in 
carious  countries,  been  used  as  monry. 


Period. 

Country. 

Substance  oaed  aa  money. 

Authority. 

B.C. 

1900 

Palestine  

Cattle,  and  cold  and  silver,  bv 

The  Scriptures. 

Arabia  

weight. 
Gold  and  silver  coin*.  

Jacob. 

I'liit-iiic-ia  

Gold,  silver,  and  copper  coins 

A  nun  vinous. 

Phoenician    col- 

Same  (some  still  extant)  

1200 

tiny  in  Spain. 
Phrygia  ....... 

Coins,  by  Queen  of  Pelops... 

Julius  Pollux. 

1181 
662 

'Gteece  
Argos  .......... 

Brass  coins  
Gold  and  silver  coins,  by  Phi- 

lloim-r. 
onary  of 

700-500 

Rome  ......... 

don. 
Brasa,  by  weight  

Dai 
Jacob. 

578 

Uncertain. 

Home  
Carthage  

Copper  coins  

Leather  or  parch  tin-lit  money, 

I  hid. 
Socrates,  Dial,    on 

B.C.  491 

Sicily   

tirot  "  paper  bills  "  known. 
Gold  coins  by  Gelo  (some  still 

Kirlie-o.    Journal 

(ll'S    Kl    Oil' 

1874,  p.  3.'4. 
Jacob. 

480 

Persia  

extant). 
Gold  coin  by  Darius  (two  still 

Ibid. 

478 

Sicilv  

extant). 
Gold    coin,  by    Hiero  (some 

Ibid. 

407 

Athens   

still  extant  i. 
Debased  gold  coins  foreign 

MacLeod,  470. 

400 
Ml 

Ml 

Sparta  
Macedonia  

Rome  

lmn,  overvalued  .  .    
First   gold    coins   coined   in 
Greece,  by  Philip. 
-il\i  r  cmim  coined  in 

Hii-.-kh. 
Jacob. 

Ibid. 

64 

Britain  

Rome. 
-  »!'  iron  

Iliid. 

50 

Koine  

Tin  and  brass  coin.  ........... 

DfttM. 

Uncertain.  . 

Arabia.......... 

Glass  coins  

N  V  'I  lilnini-.  July 

•2,  1- 

Period  follouint]  thefailurt  of  Uu  ancient  minei. 


A.D. 

212 

it)" 

K..IIH-.       (Cam 
calla.) 

Britain     

Lead  coins  silvered,  and  cop- 

.  iili-il. 
Living  money,  or  human  be- 
i  made  alegal  ii-ml' 
d.Ms   HI    about  £2  16*.  3d., 

Anonymous. 

-  11  >tory  of 
Cn-at  llrit.iin.  vol. 

IV.   |. 

1100 

Italy      

•  \  •  nil  i|     bills  of  ex- 

An  lerson. 

DM 

1574 

Milan,  Italy  .. 
China  
Africa,  pan  of.. 

Granada,  Spain  . 

cnan^i-  inirmlui  i-i!   1 
Jew*. 
PajM-i  inlNalrjrnl  tender  
I'.ii>i-r  lnlU  a  lt-i;iil  ti-n<l> 
"Machine*"   (i>i< 
tins  vii-w  iloalid-d.l 
I'.ipi-r  bill*  a  leiral  tend, 
ixiard  liilln.  rt'prewiita- 

Arthur  Young. 

,iiit-ii. 

Irving. 
Die.  of  Dates. 

Uowttain. 

: 



.,1  

A  ni'iii  iin-ii". 

Uncertain. 

Seal  iikui*  .11,  .1  1.  lubber  

Uncertain 

Jacob,  373. 

parts  of    Af- 
rica. 

11 


Table  showing  some  of  the  substances  used  as  money — continued. 
Period  following  the  failure  of  the  ancient  mine*— continued. 


Uncertain. 
Uncertain. 
Uncertain. 
Uncertain. 
Uncertain. 

Salt              

Anonymous. 
Anonymous. 
Patterson,  p.  13. 
Ibid. 
Ibid. 
Ibid. 

China  and  India. 
India  
China  

Paper  bills  ,  
Pieces  of  silk  cloth  .  ....  

Africa 

Not  stated  ... 

Wooden  tallies  or  checks  

Period  following  the  discovery  of  the  American  mines. 

A.D. 
1631 

1635 
1690 
1694 

1700 

1702 
1712 
1716 

1723 

1732 

1732 

1776 
1785 

1810-1840 
1826 
1847 

Massachusetts  .  . 

Massachusetts  .  . 
Massachusetts  .  . 
England  
SwBden  .  .  .  .  .".  .  . 

Corn  a  legal-tender  at  market 
prices. 
Musket-balls  
Paper  bills,  colonial  notea  
Bank-notes  
Copper  and  iron  coins  

4 
Macgregffor. 

Anonymous. 
Maegreggor. 
McCulloch. 
Voltaire's  Charles 
XII. 
Macgreggor. 
Ibid. 
Murray. 

Macgreggor. 
Anonymous. 

Anonymous. 
Adam  Smith. 

Wheel.-r's  History 
of    North    Caro- 
lina, 94. 

App.  En  eye. 
Anonymous. 

South  Carolina.. 
South  Carolina.. 
France  ....... 

Colonial  notes................ 

Bank  notes  

Interconvertible  paper  bills 
a  legal  tender. 
Paper  bills,  colonial  notes  
Indian  corn  a  legal-tender  at 
23d.  per  bushel. 
Tobacco  a  legal-tender  at  lei. 
per  pound. 
Teupenny    nails    for    small 
change. 
Linen    at   3».  6d.  per    yard, 
whisky  at  2«.  6d.  per  gallon, 
and  peltry  as  legal  -tender. 

Great  era  of  bank-paper  bills. 

Platinum  coins  (discontinued 
in  1845). 
Cocoa  beans  ;  and  at  Castle  of 
Perote,  soap. 

Pennsylvania  .  .  . 

Maryland.  ...... 

Scotland  

Frankland,  State 
of    (now   part 
of  North  Caro- 

All  commercial 
countries. 
Russia  .......... 

Mexico,  parts  of 

Period  following  the  openings  of  California  and  Australia. 

1849 

1855 
185- 

California  

Gold  dust  by  weight,  also  mi- 
nute gold  coins   for  small 
change,  coined   in    private 
mint*. 

Private     informa- 
tion. 

Communist  set- 
tlement    in 
Ohio,      called 
"Utopia." 

Paper  bills,   each  represent- 
ing "  one  hour's  labor." 

JON&S 


12 


Table  thawing  some  of  Ike  tubstancet  used  at  money — Continued. 
Period  following  the  opening*  qf  California  and  Australia—  Continued. 


Period. 

Country. 

Substance  used  as  money. 

Authority. 

1862 

ua 

United  State*  .. 
North  Carolina  . 

Paper  bills  a  Wai  tender  
Tenpenny  nails,   at  5  cents 

Act  of  Feb.  25. 
Anonymous. 

each,  for  small  change. 

1863     Gump    at   Flor- 

Potatoes for  small  change  — 

Yorkville  Enquir- 

ence. S.  C. 

er. 

1863     United  States... 

Postage-stamps    for      small 

change,  temporary. 

1865     Philadelphia,  Pa. 

Turnips   for  small    change, 

Philadelphia  Led«- 

temporary  and  local. 

<TV  April 

IS-'.:. 

United  States... 

Nickel  coins  fur  small  change, 

Act  of  March  3. 

overvalued. 

Au  analysis  of  this  table  will  show  how  carefully  even  the  moat 
primitive  communities  guarded  against  a  too  restricted  money  vol- 
ume. 

during  the  early  history  of  society  were,  it  will  be  observed,  such 
aa  at  the  time  and  place  would  be  of  sufficient  quantity  or  volume  to 
insure  against  any  Midden  deprivation  of  supply.  In  countries  where 
the  chase  was  common,  the  skins  of  wild  animals  were  nsed  a«  money; 
in  maritime  communitipH,  shells ;  in  pastoral  countries,  cattle  ;  in  the 
early  history  of  agriculture,  grain;  in  early  mining*  periods,  base 
metal  :  in  primitive  manufacturing  ages,  nails,  glass,  musket-balls, 
strips  of  cotton,  etc. 

AM  communities  developed,  and  commerce  between  them  began, 
substances  somewhat  common  to  all  countries,  portable  and  inde- 
Mructihle.  MH-II  as  the  precious  metals,  came  to  be  more,  ami  other 
substances  less,  resorted  to.  By  reason  of  their  great  beauty  those 
metals  were  always  in  demand,  even  among  barbarous  peoples,  for 
purposes  of  ornament  and  decoration.  Because  of  their  universal 
use  for  such  purposes  they  came  to  be  recognized  as  things  for  which 
anything  else  could  with  safety  be  exchanged,  and  as  society  ad- 
vanced, :iti(l  it  came  to  be  recognized  that  some  medium  should  l»e 
adopted  in  which  to  make  all  exchanges,  those  metals  were  naturally 
selected  lor  the  purpose,  so  that,  together,  t hey  became, as  it  were, 
a  common  denominator  of  value.  Their  selection  proved  a  conven- 
ient method  of  storing  away  wealth  in  a  form  that  commanded  at  all 
times  every  other  form  of  wealth.  They  had  always  passed  by  waight 
wherever  nsed,  but  as  society  became  better  organized,  and  its  meth- 
od- n, ore  complex,  it  became  necessary,  in  order  to  insure  against 
fraud,  to  form  them  into  piece*  ,  ..nvcnieut  for  handling,  and  to  in- 
•:i«>in  distinctly  with  the  function  of  money,  no  that,  hy  law, 
they  became  a  universal  solvent  for  debts  and  demands,  the  stamp 
of  tin*  government  placed  on  the  coin  testifying  to  its  weight  and 

Both  metals,  as  shown  by  the  table,  have  been  concurrently  nsed 
as  money  for  thousands  of  years— not  only  since  the  dawn  of  his- 
tory, hut  from  a  jx-riod  anterior  to  any  historical  records.  The  old- 
est annalsshow  that  they  had  already  K.-en  employed  a-  circulating 
media  and  that  their  relative  values,  or  the  rat  :••  ot  t  he:i  .-\,  hange 
for  one  another,  bad  already  been  established.  Gold  and  stiver 
•am 


13 


were  used  as  money  in  Palestine  as  early  as  the  year  1900  B.  C.  We 
read  in  the  Bible  that  Abraham  weighed  to  fiphron  the  Hittitfc  400 
shekels  of  silver,  "current  money  with  the  merchant."  An  inscrip- 
tion on  the  temple  of  Karnak,  of  the  date  of  1600  B.  C.  mentions 
those  metals  as  materials  in  which  tribute  was  paid. 

But  long  anterior  even  to  these  dates,  both  metals  had  been  used, 
as,  among  the  relics  of  the  bronze  age  of  the  prehistoric  era,  orna- 
ments of  both  gold  and  silver  have  been  found.  Gold,  being  the. 
less  abundant  of  the  two  metals,  has  had  the  higher  value ;  but  the 
ratio  between  the  two  has  been  marvelously  steady,  taking  into 
account  the  great  sweep  of  ages  during  which  they  have  been  used 
as  money.  This  will  be  seen  by  reference  to  the  following  tables  of 
ratios.  I  will  first  take  their  relative  values  during  ancient  times. 

Table  showing  the  ratio  of  gold  and  silver  in  various  countries  of  the 
world  up  to  the  Christian  era. 


B.C. 

Ratio. 

Authorities. 

1600 

1  to  13.  33 

iDScriptions  at  Karnak;  tribute  lists  of  Thutmosis.     (Bran- 

dis.) 

708 

1  to  13.  33 

Cuneiform  inscriptions   on  plates  found  in  foundation  of 

Khorsabad. 

1  to  13.  33 

Ancient  Persian  coins;  gold  darics  at  8.3  grams  =  20  silver 

siglos,  at  5.5  grams. 

500 

1  to  13.  00 

Persia.     Darius.      Egyptian     tribute.      Herod.      III,.  95. 

(Boeckh,  page  12.) 

490 

1  to  12.  50 

Sicily.    Time  of  Gelon.     "At  least"  12.50.     (Bceckb,  page 

44.') 

470 

1  to  10.  00 

Doubtful.    Asia  Minor.    Xerxes's  treasure.    (Boeckh,  page 

11.) 

440 

1  to  13.00 

Herodotus's  account  of  Indian  tributes.     360  gold  talents  = 

4,680  silver. 

420 

1  to  10.  00 

Asia  Minor.    Pay  of  Xenophon's  troops  in  silver  darics. 

(Anab.;  Boeckh.  page  34.) 

407 

1  to  

Spurious  and  debased  gold  coins  at  Athens.      (MacLeod, 

Polit.  Econ.,  page  47B;  Boeckh,  page  35.) 

400 

1  to  13.  33 

Standard  in  Asia,  according  to  Xenophon. 

400 

1  to  12.00 

Standard  in  Greece  according  to  "  Hipparchus  "  ;  attributed 

to  Plato. 

400 
400 

1  to  12.00* 
1  to  13.50$ 

Various  authorities  adduced  by  Boeckh. 

(19    fiftl 

Values  in  Greece  from  the  Peloponnesian  war  to  the  time  of 

404-336 

ii.  UU  I 

j.  w,13.00 
J13.33J 

Alexander,  according  to  hints  in  Greek  -writers.    There 
were'  variations  under  special  contracts  —  unit,  the  silver 
drachma. 

310 

I  to  14.  00 

Greece.    Time  of  Demosthenese.     (Boeckh,  page  44.) 

338-326 

1  to  11.50 

Special  contracts  in  Greece. 

343-323 

1  to  12.50 

Egypt  under  the  Ptolemies. 

300 

1  to  10.  00 

Greece.    Continued  depression  of  gold,  caused  by  great  in- 

flux under  Alexander. 

207 

1  to  13.  70 

Rome.     (Boeckh,  page44.)    Gold  scriptulnm  arbitrarily  fixed 

at  17.143  for  1. 

100 

1  to  11.  91 

Rome.    General  rate  of  gold  pound  to  silver  sesterces  to  date._ 

58-49 

1  to    8.93 

Rome.     Continued  depression  of  gold,  caused  by  influx  or' 

Caesar's  spoil  from  Gaul.     [N.  B.  —  Casar's  headquarters 

were  at  Aquileia,  at  the  head  of  the  Adriatic,  where  there 

was  also  a  gold  mine,  which  at  this  period  became  very 

prolific.] 

50 

1  to  11.  90 

Rome.     -'About  the  year  U.  C.  700,"  the  rate  was  11  19-21. 

(Boeckh,  page  44.) 

29 

1  to  12.00 

Rome.    Normal  rate  in  the  last  days  of  the  republic. 

It 


By  reference  to  the  foregoing  table  it  will  be  observed  that  the  in- 
crease in  the  supply  of  gold  in  Europe,  consisting  of  thespoils  of  the 
Orient,  gathered  by  Alexander  the  Great,  and  brought  by  him  to 
(.1  v. TO,  had  the  effect  of  decreasing  the  valne  of  that  metal  so  that 
instead  of  being  exchangeable  at  the  ratio  of  1  to  about  13}  of  sil- 
ver, as  formerly,  gold  became  depressed,  1  ounce  of  it  exchanging 
for  only  lOouncesof  silver.  Later,  when  Julius  Ciusar  extended  his 
fi'iium-riiii:  arms  into  Gaul,  and  sent  to  Rome  the  accumulations  of 
treasure  amassed  by  him,  the  value  of  gold  by  reason  ot  the  increased 
supply  was  again  depressed,  so  that  an  ounce  of  it  was  exchangeable 
for  only  8.93  ounces  of  silver.  With  these  exceptions  it  may  be  said 
that  the  relation  of  silver  to  gold  for  sixteen  hundred  years  before 
the  time  of  Christ  had  varied  only  from  the  ratio  of  1  to  12  to  that  of 
1  to  13.33.  Silver  at  no  time  during  all  this  period  fell  below  13.50 
to  1  of  gold. 

Looking,  now,  at  the  relative  values  of  gold  and  silver  from  the  time 
of  Christ  to  the  discovery  of  America,  we  find  the  ratio  between  the 
two  metals  to  be  as  follows : 

Table  showing  the  ratio  of  g^old  and  silver  in  various  countries  of 
the  world  from  the  opening  of  the  Christian  era  to  the  discovery  of 
America: 


A.D. 

Ratio. 

Authorities. 

1-37 

1  to  10.97 

Rome.    Rate  under  Augustus  and  Tiberius. 

37-41 

1  to  12.  17 

Rome.     Reign  of  Caligula         )  ~»       ,._  ,                    ._-u 

64-68 

1  to  11.80 

.  v-  „                  !  The  silver  coinage  much 
Home,     ittM^ii  ot  >  ero.               i     •  .        ^         «»       Mntiu 

69-79 

to  11.54 

Rome.     Reign  of  Vespasian.     J-   ","  ^T,;  '  of  ,u  . 

81-96         to  11.30 

Rome.    Reign  of  Domitian.           nurewa*  about  I  il  I 

138-161         to  11.98 

Rome.     Reign  of  Antoninua.    I    " 

::rj         to  14.40 

Byzantium     Reign  of  Countantine     Arbitrary. 

438 
864 

to  14.40 
to  12.00 

Byzantium  and  Rome.     Theodosian  code.    Arbitrary. 
Probable  ratio,  as  shown  by  the  Kdlctnm  Pist^nse,  under 

1260 

1  to  10.50 

the  Carlovingian  dynasty 
Average  ratio  in  theoommercialcitiesof  Italy.    Local  or 

doubtful. 

1'i't   I'iCi1 

1  to  

KnJ  ui.i.     N'umerons  mint  indonturvs  given  in  McLeod's 

I'nlitiral  Kconomy,  page  475.    The  ratio,  except  when 
Itxed  arbitnn  ily  ami  in  violation  of  market  price,  varied 

between  about  1.12  and  1.14  during  the  two  hundred 

and  fifty-seven  yean  included  in  this  period. 

1351 

1  to  12.  30  1 

1    to  !:•  4U 

Ratio  in  North  Germany  as  shown  by  tbe  very  accurate 

11"!      1  to  12.80  i 

rules  of  the  Lubeck  mint,  corroborated  in  the  main  by 

1411      1  to  12.001 

the  accounts  of  the  Teutonic   Order  of  Knights,  aver- 

14.M     1  to  11.70  ; 

aged  in  periods  of  lorty  years. 

14«:t      1  to  11.80  ) 

1455-1494 

1  to  10.60 

Ratio  according  to  the  accounts  of  the  Teutonic  knight*. 

An  the  ratio  tixed  in   KnitUn<l   bv   MUIIKTOIIN  mint   in- 

. 

d  DtOTM  from  IMS  to  IBMWM  about  1.12  this  <;«•!  man 

ratio  is  con  »                      .r  doubtful. 

It   .\ill  thus  be  observed  that  during  the  mu-  tlioiiMiinl  four  hun- 
dred and  nini'ty-t  «••  years  froni  the  ruining  <>t  ( 'luist  tn  tin-  • 

America,  silver  never  wont  ltel<>\\  the  ratio  of  14.40  to  one  of 
gold. 

Tin-  -  liirli  tin-  metals  have  horn.-  !<•  each  other  Hince  the 

•  t  tlie  New  World  will  appear  from  the  following: 


15 


Table  showing  the  relative  values  of  gold  and  silver  in  the  various  coun- 
tridt  of  the  world  from  the  discovery  of  America  to  1680. 


A.  D. 

Ratio. 

Authorities. 

1497 

1  to  10.70 

Spain.    Reign  of  Isabella.    Edict  of  Medina.    Local. 

1500     1  to  10.  50 

Germany.    Adam  Riese's  Arithmetic. 

Local  or  doubtful. 

l.r.51 
1559 

1  to  11.17 
1  to  11.44 

Germany.   Imperial  mint  regulations. 
German  Imperial  mint  regulations. 

Arbitrary  or  local. 

1561 
1575 

1  to  11.  70  ) 
1  to  11.685 

France.    Mint  regulations. 

1623     1  to  11.74 

Upper  Germany.    Mint  regulations. 

1640     1  to  J3.  51 

France.    Mint  regulations.    Transition  period. 

1665 

1  to  15.  10 

France.    Mint  regulations. 

1667  j  1  to  14.15 

Upper  Germany.    Mint  regulations. 

Doubtful. 

1669  !  1  to  15  11 

Upper  Germany.    Mint  regulations. 

1«79 
1680 

1  to  15.  00  ? 
1  to  15.  40  J 

France.    Mint  regulations. 

Table  showing  thfc  ratio  of  silver  to  1  of  gold  from  1687  to  the  de- 
monetization of  silver  by  Germany  an<i  the  United  States  and  the 
closing  of  the  Mints  to  its  free  coinage. 

[From  the  Report  (1890)  of  the  Director  of  the  U.  S.  Mint  on  the  Production  of  the 
Precious  Metals  in  the  United  States.  ] 

I  NOTE.— From  1687  to  1832  the  ratios  are  taken  from  Dr.  A.  Soetbeer;  from  1833 
to  1878  from  Pixley  and  Abell's  tables;  and  from  1879  to  1889  from  daily  cable- 
grams from  London  to  the  Bureau  of  the  Mint.] 


Year. 

Ratio. 

Tear. 

Ratio. 

Year. 

Ratio. 

Year. 

Ratio. 

1687  ... 

14.94 

1721.. 

15.05 

1755  

14.68 

1789  

14.75 

1688  

14.94 

1722 

15.  17 

1756 

14.94 

1790    ...   . 

15  04 

1689  

15.02 

1723  

15.20 

1757  

14.87 

1791  

15.05 

1690  

15.02 

1724  

15.11 

1758  

14.85 

1792  

15.17 

1691  

14.98 

1725  

15.11 

1759  

14.  15 

1793  

15.00 

1692  
1693  

14.92 
14.83 

1726  
1727  

15.15 
15.24 

1760  
1761  

14.14 
14.54 

1794  
1795  

15.37 
15.55 

1694  

14.87 

1728.. 

15.11 

1762     

15.27 

1796  

15.65 

1695  

15.02 

1729  

14  92 

1763  

14.99 

1797  

15.41 

1696  

15.00 

1730  

14.81 

1764  

14.70 

1798  

15.59 

1697  

15.20 

1731  

14  94 

1765  

14.83 

1799  

15.74 

1698  

15.07 

1732  

15.09 

1766  

14  80 

1800  

15.68 

1699  

14.94 

1733 

15  18 

1767 

14  85 

1801  

15.46 

1700  

14.81 

1734  

15  39 

1768    .. 

14.80 

1802  

15.26 

1701  

15.07 

1735  

15  41 

1769  

14.72 

1803  

15.41 

1702  

15.52 

1736  

15.  18 

1770  

14.62 

1804  

15.41 

1703  

15  17 

1737 

15  02 

1771 

14.66 

1805  

15.79 

1704  

15  22 

1738 

14  91 

1772 

14.52 

1806  

15.52 

1705  

15  11 

1739 

34  91 

1773  

14.62 

1807  

15.43 

1706  

15.27 

1740  ..... 

14  94 

1774  

14.62 

1808  

16.08 

1707  

15  44 

3741 

14  92 

1775 

14.72 

1809 

15.96 

1708  

15  41 

1742 

14  85 

1776 

14  55 

1810     ..   . 

15.77 

1709  

15.31 

1743 

14  85 

1777 

14.54 

1811  

15.53 

1710  

15  22 

1744 

14  87 

1778 

14  68 

1812 

16.11 

17U  ... 

15  29 

1745 

14  98 

1779 

14  80 

1813       .  . 

16.25 

1712  

15  31 

1746 

15  13 

1780 

14  72 

1814  

15.04 

1713  

15.24 

1747 

15  26 

1781 

14.78 

1815  

15.26 

1714  

15.13 

1748 

15  11 

1782    ..     . 

14.42 

1816  

15.28 

1715  

15  11 

1749 

14  80 

1783 

14  48 

1817       .   . 

15.11 

1716  

15.09 

1750 

14  55 

1784 

14  70 

1818  

15.35 

3717  

15.13 

1751 

14  39 

1785   . 

14.92 

1819  

15.33 

1718  

15  11 

1752 

14  54 

1786 

14  96 

1820  

15.62 

1719  
1720  

15.09 
15.04 

1753..!!!. 
1754 

14.54 

14  48 

178?!!!... 
1788 

14.92 
14  65 

1821  
1822  

15.95 
15.80 

Tear. 

Ratio. 

Yt-ar. 

Ratio. 

Yf.ir. 

Ratio. 

Y,*r. 

Ratio. 

1823  

15.84 

183C  . 

15.72 

1849. 

16.78 

IM;I  . 

15.50 

1824    

15.82 

1837. 

15.83 

1850  . 

15.70 

;  .-rj  . 

15.35 

1825    

15.70 

1838  . 

15.85 

1851  . 

1MB  . 

15  37 

J826  

15.76 

1839  . 

15.62 

1852. 

15.59 

1864  . 

15.37 

J827  

15.74 

1840  . 

15.  «2 

1853  . 

16.33 

1865  . 

15.44 

1828  

15.78 

1841  . 

15.70 

1854  . 

15.33 

1866  . 

15.43 

1828  

15.78 

1842  . 

15.87 

1855. 

15.38 

1867. 

15.57 

J830  

l.V  .-I! 

1843 

15.  'J3 

1856. 

15.38 

ln-.S  . 

15.  5!> 

1831  

15.72 

1844. 

15.85 

1857  . 

15.27 

].-<;•.»  . 

15.60 

1K12    

15.73 

1845  . 

15.92 

1858. 

15.38 

1870. 

16  57 

1833  

15.03 

1846  . 

15.90 

llvVJ  . 

15.19 

1871  . 

15.57 

1834  

15.73 

1847  . 

15.80 

1860  . 

15.29 

1872  . 

15.63 

1835  

15.80 

1848. 

15.85 

\ 


By  the  foregoing  table  it  will  be  seen  that  in  the  three  hundred 
and  seventy-live  years  from  1497  to  1872  the  maximum  separation  of 
the  metals  was  only  as  1  to  16.25 — notwithstanding  tin-  \\ni.--i  di- 
vergencies doling  that  long  period  in  the  yield  ot'  tin-  two  nn-tals 
from  the  mines.  It  will  be  observed  that  all  f  ho  later  quotations  are 
from  the  London  market,  but  it  is  a  .signliii'ant  fart  that  in  Franco, 
where,  by  the  law  of  7  Germinal,  ^n  XI,  ( I .-(•:;.  i  fr.-r  < oina^i-  was  per- 
mii  tfd  to  both  metals,  at  the  ratio  of  15^  of  silver  to  1  of  gold,  fur  a 
period  of  seventy  years,  and  until  the  coinage  of  silver  w;. 
ited.  there  was  at  no  time  the  slightest  variance  from  that  relation. 

When  silver  was  deprived  of  the  full  money  fnnetion,  an«l  all  the 
money-\vi>rk.of  society  wa«  plue.nl  on  gold,  the  inetuls  began  • 
arate.    The  following  table  shows  the  degree  of  that  separation  from 
year  to  year: 

Table  showing  the  ratio  of  silver  to  1  of  gold  since  the  domonet  i/.a- 
tion  of  nilver  by  Germany  and  the  United  Stairs,  and  the  closing  of 
all  mints  of  the  western  world  to  its  free  coinage: 


1R73 x 15.92 

Ifl.  17 

16.59 

17.  cH 

.  17.L-.' 


18.19 

18.64 

18K4....  .  18.57 

1885 19.41 



1887 -Jl.n 

SI.M 

UN... 


17.94 

IK.  in 

1S80 1*.  US 

1801 18.10 

Tbe  foregoing  figures  show  that  it  in  only  since  tlm  legislative pro- 
8cripti.ni  ot  silver  by  Germany  and  the  I'mtr.i 

ing  of  all  .tile  European  mints  to  its  eoinagi-,  that  an>  mateiial 
changf  took  place  in  tho  ratio  ln-tween  tin-  two  im-talx,  whii  h  i-on- 
clu^ively  demonstrates  that  tin-  pn-sent  d'\.-  •  In-  ndat  i\  r 

valut^  •  .Inetothr  i'-^.ii  outlaw  i  \   • 

•  1  nor  to  natural  i  a  uses. 

oh"  has  the  coin-in  rent  line  of  the  1  wo  metals  a.s  moiirv  lind  tln< 

•  n  of  ail  time,  Imt  the  approval  of  tin-  [ 

.ml.  wln-n  not    Idindrd    1-  I  he   appn.'. 

tical  ..  .••need  tinaiicial  mn  .  /<  d   is  this 

"iily  cite  a  few  instances  of  sm-h  approval. 
"ii  said  : 


il.lt  I 
Al. 
To  annul  f 


•on  i.- 
k--  • 

joxia 


•  u»r  of  i-it  li«r  of  the  metals  »- 

•     al.li'  tn  all  tin-  olijcc(if.ii4  -A 

j /uii  u.-i£A  (A«  «piii  <j^o  teantjf  circulation.     •!..  j...ii  tu  CUD- 


17 

Thomas  Jefferson,  in  a  letter  to  Hamilton,  indorsed  this  view, 
saying : 

I  return  yon  the  report  on  the  mint.    I  concur  with  you  that  the  unit  must  stand 
on  both  meia  «.     (Letter  to  Hamilton,  February,  1792  )" 

In  his  "Recherches  sur  1'or  et  sur  1'argent,"  1843,  Le"on  Fauchet 
said : 


In  a  memoir  read  before  the  French  Institute  in  1868,  M.  Wolowski 
1/1  • 


said : 

The  suppression  of  silver  would  bring  on  a  veritable  revolution.  Gold  would 
augment  in  value  with  a  rapid  aad  constant  progress,  which  would  break  the  faith 
of  contracts  nd  aggravate  the  situation  of  all  debtors,  including  the  nation.  It 
would  add  at  «>ne  stroke  of  the  pen  at  least  three  milliards  to  the  twelve  milliards 
of  the  public  debt. 

In  a  debate  in  the  French  Senate  on  January  23,  1870,  Senator  Du- 
mas eloquently  pleaded  for  caution  in  dealing  with  a  subject  of  such 
fat-reaching  importance  as  the  demonetization  of  one  of  the  money 
metals.  He  said: 

Those  who  approach  these  questions  for  the  first  tima  decide  them  at  onoe. 
^Fhose  who  study  them  witti  care  hesitate.  Those  who  are  obliged  practically  to 
decide  doubt  and  stop,  overwhelmed  with  the  weight  of  the  enormous  responsi- 
bility. 

The  quantities  of  the  precious  metals  which  are  now  sufficient  may  become  in- 
sufficient, and  we  should  proceed  with  great  prudence  before  we  diminish  that 
which  constitutes  a  part  of  the  riches  of  the  human  race.  Sometimes  gold  takes 
the  place  of  silver.  Sometimes  silver  takes  the  place  of  gold.  This  keeps  up  tlir. 
general  equilibrium.  Xobody  can  guaranty  that  the  present  vast  production  of 

§old  will  continue.    The  placers  are  found  on  tne  surface  of  the  eaith,  and  may 
e  exhausted  by  the  very  facility  of  working  them.     Silver  presents  itself  in  the 
form  of  subterranean  veins.    Science  mav  contribute  to  accelerate  its  extraction. 
In  presence  of  the  unknown,  which  dominates  the  future,  we  should  practice  a 
prudent  reserve. 

Before  a  French  monetary  convention  in  1869  testimony  was  given 
by  M.  Wolowski,  by  Baron  Rothschild,  and  by  M.  Rouland,  governor 
of  the  Bank  of  France. 

M.  Wolowski  said : 

The  sum  total  of  the  precious  metals  is  reckonedat  fifty  milliards,  one-half  gold 
and  one-half  silver.  If,  by  a  stroke  of  the  pen,  they  suppress  one  of  these  metals 
in  the  monetary  service,  they  double  the  demand  for  the  other  metal,  to  the  ruin 
of  all  debtors.  *  * 

M.  Rouland,  governor  of  the  Bank  of  France,  said : 

We  have  not  to  do  with  ideal  theories.  The  two  moneys  have  actually  co-ex- 
isted since  the  origin  of  human  society.  They  co-exist  because  the  two  together 
are  necessary,  by  their  quantity,  to  meet  the  needs  of  circulation.  This  necessity 
of  the  two  metals,  has  it  ceased  to  exist?  Is  it  established  that  the  quantity  of 
actual  and  prospective  gold  is  such  that  we  can  now  renounce  the  use  of  silver 
without  disaster? 

Baron  Rothschild  said : 

The  simultaneous  employment  of  the  two  precious  metals  is  satisfactory  and 
gives  rise  to  no  complaint.  "Whether  gold  or  silver  dominates  for  the  time  being, 
it  is  always  true  that  the  two  metals  concur  together  in  forming  the  monetary  cir- 
culation of  the  world,  and  it  is  the  general  mass  of  the  two  metals  combined  which 
serves  as  the  measure  of  the  value  of  things.  The  suppression  of  silver  would 
amount  to  a  veritable  destruction  of  values  without  any  compensation. 
JONES 2 


At  the  session  (October  30,  1-7. i)  of  the  IMyian  MonetaiA  Ci>mmis- 
sion.  Trot'cN,!,]  1.  ac  of  ilie  mo.st  luminous  writers  on  eco- 

nomic subject.*,  said  : 

IPS,  and  among  them  the  state-  'at  to  ).ny  in  gold  or  sil 

.t  can  not  '••  iv  witnmit  disturbing  tin.-  rabuuHi  of  debu 

ciediturs,  to  tin   prejudice  of  debtors,  to  the  extt-ut  of  ;• 

of  one-third.     To  incr«-a*e  all  debt*  at  a  blow  dr 

hut,  mi  n-vuliitionary.  ili.it  I  c-.m  uot  believe  that  the  Cor.-iniuent  will  pi. 

(.r  that  the  Chamber*  will  vote  it. 

WHY   WAS  THE   AUTOMATIC  BTHTF.M    I.S  1  KIU  KKEI>  WITH  T 

Some  thirte.-n  yi-ars  ago,  as  Chairman  of  the  Monetary  Commis- 
sion appointed  !•  -Njjatc  tin-  can>e.sot  the  chan.i;i-« 
in  tin-  relative  values  of  i!ie  precious  m«-ral>,  I  submitted  to  this 
liody  a  report,  in  which  I  t<iok  occasion  to  refer  to  the  mo  ives  which 
evidently  intlnenee.l  the  creditor  classes  ..('  1,1,-  western  world  in  de- 
stroying the  automatic  system  of  money  .  From  that  Krport  I  quote 

The  world  has  (jem-rally  favor  d.  thi-oretii-nlly  if  not  practically,  the  automatic 
metallic  H.VHtem  ainl  aiijinli-.l  r  -.-il  mil-  nn-:a: 

a*  their  .ilamlanl.  and  «nne  tin-  «>t  in-r.  anii  smur  adopted  lintli.    TlnMt-  that  adopt'vl 
lx>th  iiirtalu  served  a-*  a  balance- wheel  to  steady  with  >-\a  ctnexs  t!'«-n  :• 
The  prac  lical  i-lln  l  of  all  of  this  was  the  name  a-t  if  all  nations  had  adoptrd  ii  .r:, 
because  it  aecureil  the  em  »nh  at  a  lix.  .1  i-.|  ui\  al<  m-\  ti<r  tin-  • 

tiou  of  the  bu.siiieMH  of  the  wm  hi.     \V4iile  s  mil-  n. it  ions  !..i%  .•  chanu<  d  tin-.: 
nii'tal.  or.  huviii):  had  ]iaper  niniiey.  h  •    pa\  m. -111.1  in  one  nn-t.il 

the  po,  •  il  demonetization  nt'om-  of  thi  -  !ii  -.t  biua.  '•• 

alxtut  t\v<-nn  \i..int  icn  formidable  propaganda  WM  or- 

gani/.cd  in  l.i^i.  n  th. n  pn'. i.  -.  nji  ii:  ;  ...1  world. 

This  new  schiK)!  of  tin.mci.il  thij<>r  -  the  n  ii-ntion  of  metal  a«  the 

material  nf  nioiu-y,  but  favor  it*  MihpTtion  ' 

•nini"*  .Hi-  di-ooveied,  or  old   •  nei    \i-ld    or    jii  • 

yii-ld  more  abundantly,  instead  «1  fn-i  -Iy  acn-p:  iin:  th.-:r  product   in  an.. 
with  th-  the\  advi'.  i   tin-  I  e«t  i  . 

'lutr  ]irohibi(ion  of  the  i-oin.i.  •    through  the 

limitalioii  or  the  abolition  ol  the  togM-tender  fiiin-tion  of  one  of  the:n.      \\  ; 
. -rrditor  am:  ns,-s  M-euj  to  be  in  danger  of  lx 

paired  b\  an  IIH-II.I-.-  in  (he  volum.-  and  di-cieu.se  in  tin-  \.ilne  of  mon> 
otlii-r  word*,  by  a  KI-IM-I  so  modern  theorist**  ar> 

.iitrif-i  I'm  •!'•  I  i!i.    mom  \  im-tals,  and 

in  Min^li-  ntand.ird  count!  irs  foi  ilu-  -  lion  from  (he  m<-t-il 

which  proiniMeit  the  nm-t   to  th !••    that   proiuis«-.-<   t;,.-    h-a-t    abundant    -upp:\ 

.uixioim  foi 
d  ia  composed  when  »m 'h  m.tti-rial  i»  rising  in  TjJoeand  price* at*  falling, 

ami  flreedinjjlv  tip|pn-ln-n«iv(.  of  the  evil  ami   in.  predict 

ax  Mure  to  rr 

a  natural  or  artificial  . 

In. n    in   llic  \i. limn-  1. 1    UK 

•  *.  It  will  I. 

lr,    (1.- 

.  -I.-  nl    111.-  I, 

•of  of  the  UlltitnvM  tor  money  of  the  ib-m. 

• 

property  cheaper  ii: 

.1  .M  - 


19 

This  is  aone-sidi>d  system,  which  can  operate  only  in  the  interest  of  the  security 
creditor,  the  usurer,  aud  pawnbroker,  whom  it  enables,  through  the  falling  prices 
which  itself  occasions,  to  swallow  up  the  shrunken  resources  of  the  debtor,  but 
is  impotent  to  protect  the  interests  of  the  unsecured  business  creditor,  the  debtor, 
or  society,  when,  from  any  cause,  the  supply  of  the  money  metals  becomes  deficient. 

The  world  has  expended  a  vast  amount  of  labor  in  the  production  of  the  pre- 
cious metals,  and  has  made  great  sacrifices  in  upholding  the  automatic  metallic 
system  of  money,  and  has  a  right  to  insist  that  it  shall  be  consistently  let  alone  to 
work  out  its  own  conclusions,  or.  that  it  be  abandoned. 

The  history  of  the  subsequent  struggle  to  reiuonetize  silver  only 
serves  to  illustrate  and  emphasize  the  correctness  of  that  statement 
of  the  case. 

Between  1810  and  1849,  according  to  Tooke  and  Newruarch  (Tec- 
oguized  authorities  on  the  subject),  gold  increased  in  value  145  per  / 
cent,  which  is  equivalent  to  a  fall  in  the  general  range  of  prices  of 
59  per  cent.  No  movement  was  then  made  or  suggestion  offered  by 
the  debtors,  or  by  any  class  of  the  community,  to  add  any  new 
money-metal  to  the  metals  already  in  use,  with  the  view  of  increas- 
ing the  volume  of  money,  so  that  the  equity  of  time  contracts  might 
be  maintained,  and  the  value  of  the  unit  of  money  kept  at  a  steady 
and  unchanging  level. 

But  as  soon  as  the  discoveries  of  gold  were  made  in  the  alluvial 
deposits  of  California  and  Australia,  or  rather  as  soon  as  it  was  sus- 
pected that  money  would  thereby  become  considerably  increased 
in  volume,  the  annuitants  and  income  classes,  the  creditors  every- 
where, took  steps  to  avert  what  they  characterized  as  a  great  calam- 
ity. They  openly  declared  their  purpose,  by  every  means  in  their 
power,  to  prevent  a  decline  in  the  value  of  money,  so  that  the  pur- 
chasing power  of  their  incomes  might  not  be  reduced.  They  de- 
termined to  go  to  any  length  in  order  to  prevent  the  rise  of  prices 
which  their  aggressive  instincts  led  them  to  fear  would  follow  the 
additions  to  the  money  volume  of  the  world  by  the  natural  aud  much 
needed  yield  of  the  mines. 

The  fiat  therefore  went  fortk  that  one  of  the  metals  must  be  dis- 
carded. 

THE  PROPOSITION  FIRST  MADE  TO  DEMONETIZE  GOLD. 

If  anything  were  needed  to  demonstrate  that  the  reason  for  the  de- 
monetization of  silver  was  the  cupidity  of  the  creditor  classes — the 
money-lenders,  annuitants,  and  those  in  receipt  of  fixed  incomes — 
and  that  it  was  not  any  defect  inhering  in  the  metal  silver,  nor  any 
change  in  its  adaptability  to  subserve  the  purposes  of  money,  it  is  to 
be  found  in  the  significant  fact  that  the  metal  first  selected  for  de- 
monetization was  not  silver  but  gold — that  metal  which  has  since 
become  the  idol  of  the  money-changers,  and  which  is  now  declared 
to  be  the  only  "natural"  money.  The  openly-avowed  determination 
was  to  increase  the  value  of  money,  and  in  order  to  accomplish  that 
purpose  the  metal  which  promised  the  largest  yield  was  to  be  con- 
demned and  stripped  of  its  ancient  monetary  function.  So  strongly 
was  this  determination  set  forth,  so  earnestly  was  it  presented,  and 
so  urgently  pressed  on  the  ground  of  duty  that  its  achievement  came 
to  be  regarded  as  the  fulfillment  of  a  high  moral  purpose, 

It  was  with  gold  then  as  it  came  to  be  with  silver  afterward, 
and  as  it  always  is  with  whatever  interferes  with  the  interests  of 
privileged  classes,  intrenched  in  power  and  prerogative, — the  deter- 
mination to  destroy  it  being  arrived  at,  measures  were  taken  to  prove 
that  the  public  good  required  its  destruction.  While  the  purpose 
was  to  discard  the  metal,  whether  gold  or  silver,  which  threatened 
most  immediately  and  seriously  to  reduce  the  purchasing  power  of 


28 

money,  the  argument  was  that  a  decrease  in  tlif  purchasing  power  of 
~  a  calami;;.  L6  happening  of  which  ev< 

should  be  directed. 

Tin-  privilege*,  -.ml  then,  as  they  find  now.  able  and  in- 

.1  defenders  aiii-in^  tin-   literary  and  edu 

guilds  tit'  the  p'-riod.  Tin iehrated  I>e  <t>  liuey,  in  Kn^laiul,  at- 
tempted to  prove,  and  to  his  o\vn  satisfaction  did  prove  upon  fig- 
ures drawn  from  hi.s  fears  and  a  brilliant  imagination,  that  tin-  least 
\  ii-!d  of  gold  to  In-  e\p .•<•;.•(!  fnun  the  mines  of  Cal  ifornia  and  Anstra 
lia  for  an  indefinite  ncriod  iu  the  futiirv.  .  ie  yearly  sum  of 

00. 

iievalier,  in   France,  vehemently  proclaimed  the  necessity  of 
:  the  mo, iey  metals,  and  that  one  not  silver  hut  i^old. 
In  his  work  upon  the  "  Fall  of  Cold'1  M.  Chevalier,  in  1  .*;"*»,  waid  : 

The  quantity  of  cold  annually  thrown  on  the  c*>ii<-ral  maiki-t   appi-n.-- 
rtiiinrl  i  !i.iril.>r  tr  u  twoooantritMi (Cftlifornin 

and  Au-tr.ili.u  inu-'  in  «>irh  <|ii:intitU-M 

ami  on  su<  h  rninliti»ii!t  an  to  r.-inl,-i  u  in.irkiMl  iln-l.iii-  ni  its  v.ilim  im-vil:ilili-. 

1 1 nia  tliat  so  v:i.«t  :i  }in>ilui'tii>ii  MlnuiUl  hi-  MXXH&p§Oi*d  "illi  • 

DdactloDia  value. 

In  n<»  itin-ciion  can  a  new  outlet  b«  seen  mittirii-ntly  Ur^i<  t<>  nUsoi  i 
tlin.irv  jirixliic  timi  of  K"i'l  which  we  are  now  witiu'it.siug.  »»  as  t4»  pruvont  :i 
lue. 

•  .  wi-  p.>«.te»M  .1  vi-ry  rnlxint  faith  in  tin-  Immobility  <>f  huniiin 
:  .1  thr  fall  iu  the  value  of  gold  as  an  event  for  which  we  nhuul<l  prc- 
:iic.ut  lor.»  of  tiiiuv 

The  "  preparation"  which  Chevalier   advocated    was  the  diseard- 

that  metal    which    yave  promise    of  the  i  bnndance. 

H.'  did  not  attempt  lo  hide  his  purpose.  He  Imidly  stated  that  hi« 
nlijeet  was  to  enhance  the  value  of  money.  This  object  was  al><> 
clearly  cxp rested  on  a  lat.  r  occ-asion  Ity  another  distinguished  advo- 
c-iteof  dear  money,  Mr.  Victor  Hoiiarl,  of  France,  in  the  .Journal  de.s 
i  I,-  -aid: 

th  the  precioiM  m-t.ils.  anil  if  tin-re  i»  any  ilan- 

in  t  which  it  i.i  nt-cciuutry  t-i  -uanl,  it  i.t  that  tin.*  saturation  rtlioulil  !..•.  i.n..- 
greater.     •     *     * 
If  tbeaDnaal  production  of  gold  !•  now  reduced  to  500  •  -  let  nstbank 

1  >r  it.  ami  !••!  il.s   wish  that   it  iniv  mi!   li"  to"  r  .quill  V  liiiM--;n»il,   whiTi'tiv 
r.i«Ni-<l.     It  i-i  ih.   I^MI  ^r.-iit  aliuudauco  auiluol  t  bo  scarcity  ol' 
BJ  which  i.i  to  be  apprebeodtd 

OOLU  1>EMOXETIZEU. 

In  1-  : 'nan  states  and  Austria  denioneti/«'d  ^oM  ;   ami  had 

it  in>t  Keen  for  the  opposition  of  France.  \\  lu.-li  loiUtaa  on  retaining 
the  doiiMe  standard,  the  movement  miyht  have  lieconie  general  on 
the  continent.  With  F.nu'land,  however,  nothing  could  !>••  dom-. 
Mor.-  t  h.in  a  L"'ncration  had  passed  sim-e  it  had  declared  for  the 
Kindle  standard  of  ijold,  and  its  creditors  and  income  clauses — the 
hhrewde-t.  most  ad.-pt,  and  watchful  of  financiers— did  not  believe 

that  the  large  yield*  of  gold  would  loaf  oontiooe^ 

The  ei  edit  or  classes  of  the  contiiieat,  li  ml  i  in,'   Filmland  i  m  nn  i 
and  reali/in^  that    the  object   .sought    by  the    Kn^'lish   creditors   wa> 
identical  with  their  own,  namely,  the  increase  in  the  value  of  i 
ami  the  depression   of  prices,   concluded   that    the  common    p 
could  be  JIM   well  •erred  by   the  di-moneti/ation  of  one  as  by  that  »:' 

•  d  by  developments  on  the 

Mile   \\  hose   bountiful    and    bem  lir. -lit     yield    of    nil  ver  \\  :i< 
the   littilltf  supplement  to   I  M   on   the    1 

.1-  more  im- 
:i«-  anii'ii:  ;       C'omm 

.   e  sub- 


21 

ject.  The  United  States,  too,  sent  a  commissioner  to  examine  into 
the  condition  and  prospects  of  the  Couistock,  and,  imbued  with  many 
of  the  characteristics  of  De  Quincey  and  Chevalier,  the  United 
States  commissioner,  in  1868,  reported  that  if  all  other  mines  were 
worked  with  the  machinery  used  on  the  Comstock  "their  yield 
would  flood  the  world." 

Like  many  of  the  present  opponents  of  silver  he  was  endowed  with 
the  gift  of  prophecy,  and  accordingly  we  find  him  confidently  pre- 
dicting that  ether  and  innumerable  rich  lodes  of  silver  would  be 
found  on  the  Pacific  coast  which  would  be  worked  with  great  profit. 
The  attack  on  gold  was  immediately  changed  to  a  combined  attack 
on  silver.  From  that  period  till  the  present  no  means  have  been 
left  untried  to  belittle  and  degrade  that  metal,  and  also  to  dis- 
parage those  who  are  in  favor  of  continuing  it  as  one  of  the  money 
metals  of  the  world. 

It  was  then  announced  with  all  the  dogmatism  of  authority  that 
silver  was  unfit  to  be  used  as  money.  Defects  were  suddenly  dis- 
covered in  it  that  the  scrutiny  of  three  thousand  years  had  Tailed  to 
disclose.  Its  weight  and  bulk  were  found  to  be  insuperable  obsta- 
cles to  its  use  as  money.  Yet  the  specific  gravity  of  silver  is  no 
greater  now  than  it  has  been  for  all  the  ages  during  which  it  has 
been  used  as  money  by  all  mankind,  nor  is  it  any  heavier  or  more 
bulky  than  it  was  in  1851  or  1857,  when  Belgium,  Germany,  and 
Austria  demonetized  gold  and  made  the  "  heavy,"  "  bulky,"  and  "  in- 
convenient" metal,  silver,  their  only  money  metal.  Silver  can  now 
be  transported  from  place  to  place  with  less  risk  and  at  no  greater 
expense  than  gold,  and  at  much  less  cost  than  at  any  previous 
period  in  the  history  of  the  world. 

The  objection  that  silver  is  too  heavy  for  the  pocket  is  an  ob- 
jection common  to  all  metallic  money.  We  see  hardly  any  gold  in 
circulation  in  this  country — infinitely  less  than  of  silver.  When  our 
people  have  a  choice  as  to  the  form  in  which  they  will  take  money 
fhey  prefer  paper  representatives  as  being  the  most  convenient.  The 
extraordinary  perfection  to  which  the  arts  of  the  engraver  and  pa- 
per maker  have  been  brought  gives  paper  money  a  security  against 
counterfeiting  and  imitation  far  superior  to  any  immunity  which 
can  be  claimed  for  the  metals.  The  marvellous  inventions  of  modern 
times  in  the  form  of  safes  and  vault-locks  render  it  a  matter  of 
practically  no  risk  to  store  the  metals,  both  silver  and  gold,  so 
that  paper  representatives  of  them  may  be  issued.  These  represen- 
tatives are  preferred  by  the  general  mass  of  the  people,  and  have 
almost  entirely  occupied  the  channels  of  circulation  to  the  exclu- 
sion of  both  metals.  A  silver  certificate  for  $1,000  weighs  no  more 
than  a  gold  certificate  for  the  same  amount. 

THE  MOTIVE  FOE  DEMONETIZING  SILVEH. 

The  motive  for  the  demonetization  of  silver  was  precisely  the 
same  that  had  previously  inspired  the  demonetization  of  gold.  The 
object  was  to  demonetize  one  of  the  metals — that  metal  which  prom- 
ised the  greatest  abundance,  and  which  would  contribute  most 
largely  to  maintaining  at  an  equitable  level  the  general  range  of 
prices.  The  motive  in  both  cases  was  to  aggran  dize  the  privileged 
classes — the  income  and  the  creditor  classes  of  the  world — and  by 
means  of  a  subtle  and  sinister  manipulation  of  the  money  volume, 
whose  effects  it  is  not  always  easy  to  trace  to  their  true  cause,  to 
practically  confiscate  the  reward  of  the  hard  toil  of  the  masses.  To 
all  intent  and  purpose  the  design  was  to  establish  a  new  system  of 

JOXES 


22 

slavery  for  the  western  world,  of  \vliicb  the  debtor  classes anion^  tin- 
white  races  should  be  the  victims. 

When  demoiii'ti/atioii  was  determined   <m   tln-n-   was  no  p;, 
that  there  was  any  difficulty  in  maintaining  :i  parity  between  tin-  two 
metals  at  the  established  ratio. 

In  the  oHicial  rectum-  of  the  doings  of  the  French  monetary  commis- 
sion of  18(59  the  arguments  UJMHI  both  sides  were  summed  up. 

In  behalf  of  the  jjold  standard  it  was  said  : 

The  n  .vhieh  has  taken  place  within  twenty  years  in  a  great  number 

of  articles  of  merchandise  is  evidently  dm-  to  many  •  •.!•.--  -   Midi  as  « 
-.  and  increase  in  OOMOmptiOD  ;   but  it  is  v.-r\"  nrohahh-  thai  the  d< 
tlon  of  i tic  precious  metals  h:is  t'lintriliiiii-il  to  it.  since  thete  ha*  been  a  sinking 
coincidence  between  tin-  rise  ot  •  !  tin-   jnodiiction  of  the  new  mines  of 

gold  and  silver.  The  annual  production  of  t  he  two  nn-t.il>.  which  wan  only 
$80,000,000  in  1-  ;  la  now  $_'l'O.Ui>0,000.  It  has  nearly  tripled,  and  r 

..lit  the  real  value  of  the  nietals  has  dim  ini-lu-d.  It  is  dilticiilt  toestim.ite 
exactly  what  the  diminution  is.  but  whatever  it  in;.\  be  it  demands  the  alien. 
tion  of  governments,  i,,.,  ;,iix,  it  atb-cts  iinthvorubly  all  that  portion  of  the  popu- 
lation whose  income.  remaining  ni>iiunally  the  same,  undergo,  s  it  \earh  dim, nil 
tion  of  purchasing  power  A-i  govei  nments  rontiol  the  weight  :n •• 
money,  they  ought  so  tar  as  possible  to  assure  its  value.  And  as  It  is  admitted 
thai  tl  -  il  th<-  in. -t  Us  is  to  depreciate,  this  tendency  .should  be  a: 

by  demonetizing  one  of  them 

In  behalf  of  the  double  standard  it  was  replied  as  follow  i : 

Many  economists  argue  that  the  precious  metals,  h.ix  ing  liecnme  M  rv  abundant, 
^t  10  or  15  per  eent.  of  their  value,  and  that  the  situation  must  b.-  rcdic-s.  d 
by  making  mom-v  se.irrer  by  demonetizing  silver.     To  this  it   ma\    In-  ai 
that  llo  i-ries  of  gold  of  the.  hist   twenty  \fant  have   injund  noUxlv. 

Tin-  new  mass  of  gold,  -pleading  over  the  whole  World,  has  found  einplov  inenl  in 
stimulating  all  forms  of  business,  and.  iii»  a  consr<|iieiice.   the    vain. 
fallen  very  little      According  to  Mr.  N  cwmaich.  the  mass  ,,t  gold 
augmented  :i  per  cent,  per  annum,  while,   the  mass  ol   exi-liange-*  ha-   .lu^nu  nii-d 

•  .per  annum,  MI  that   the     iMiilihi  iiim   has   bet-n   HIM  : 
And  the  present  is  nn  especially  inoi'li'ii  limn  time  to  deinoneti/r  l! 

:    i.il   product ii f   jrolil  ha«  \wen  tailing   oil'   lor   «i -viral  \.iii-      ll   \\.i- 

92M.OOo.uni>  in  I.-L:I.  and  it  is  now  not  more  than  .*  Ud.Oou.*  0».     What   »  ill  hap|..  n 
to  the  civilised  world  if  silver  is  demonetized  and  if  gold  shall  then  fail  I 
THE  MOTIVE  OF  KX(il.A.M>. 

Kn^lanil  diil  not  adopt  the  «old  standard  until  she  was  in  a  posi- 
tion to  become  the  principal  creditor  nation.  When  her  ! 
furnaces,  spindles,  and  looms  were  read\  to  supply  manufactured 
goods  to  all  the  world,  she  saw  that  all  conntrie-and  peoples  would 
be  compelled  to  pour  their  treasures  into  her  lap.  Her  insular 
position  and  jjreat  navy  guarantied  her  a-a,n-t  external  as-.;H.]t. 
Released  from  the  anxi<-;i«->  and  labors  incident  to  the  Napoleonic 
-\ith  n  sturdy  popnlat ion  of  trained  mechanics,  and  with 
helds  of  coal  and  iron  in  iibnndan'-c.  she  was  w  ell  adajiteil  to  !>• 
the  "  work-ho])  of  the  world."  With  colonial  jio-scs-ions  in  c\ct\ 
Sen,  and  with  Continental  Kutope  in  rea-e.  .  Kn^land  could 

-:omers  who  c«mld  themselves  produce   nothing   but    raw 
material  and  would  be  obliged  to  buy  her  !:ni-licd  pnxl 

'I  lie  t'n-ld  of  industry  ha<:  utly  bioad.-ncd  by  ba-ic  inven- 

tions ol  im  pat  a  lie  led  impoi  t.nn  ••      t  be  steam  -engine,  the  power  loom, 
the  opininn^  jenny,  and  a  mult  ijilicity  of  other  <le\  ice-that  in. 
n  hundred  fold  tin-  eflh  jet  J  ind  knew  that 

ide  would  in  the    main    1"  .nd   her  financial 

dealings  largeh  with  foreign  gOVenUDettt*.  She  Knew  that  from  tin- 
people  of  i  hi- continent,  inipox  eri-hed  by  \cai-  nt  -t  i  u^gle  for  exiat- 
enoe  Against  the  at  tack-  i  it  Napnb  mi,  »ln-  could  not  expect  immeiliate 
pay nn  :i.  or  in  <-oiiiiin>dities.  Time  bond-  and  other  ib-- 

Hi  were  the  media  in   which    for   the    mo-t    p;irt    -ho 
received  pay  ,  she  made  int< n-st  and  principal  pa\  able  in  pdd  alone, 


and  if  before  the  date  of  payment  the  value  of  money  should  in- 
crease it  would  not  be  to  the  disadvantage  of  the  creditor.  What- 
ever we  may  think  of  the  ethics  of  this  policy,  we  can  have  no  dif- 
ficulty in  understanding  its  motive. 

ACKNOWLEDGMENT  OF  THE  MOTIVE. 

As  to  the  object  which  England  had  in  view  in  demonetizing  silver 
we  are  left  in  no  sort  of  doubt.  It  has  been  candidly  admitted  by 
many  of  her  financiers  and  publicists.  The  reason  for  her  stolid  ad- 
herence to  the  gold  standard  now  is  the  same  for  which  she  origi- 
nally demonetized  silver.  Her  income  and  creditor  classes  are  daily 
in  receipt  of  an  unearned  increment  to  their  wealth  by  reason  of  that 
demonetization.  More  candid  than  the  advocates  in  this  country  of 
the  single  gold  standard,  the  writers  and  press  of  Great  Britain  openly 
avow  the  object.  No  better  testimony  to  the  fact  can  be  adduced 
than  that  supplied  by  the  royal  commfssion  appointed  in  1836  to  in- 
quire into  the  changes  in  the  relative  values  of  the  precious  metals. 

At  page  90,  Part  II,  of  the  final  report  of  that  body,  section  128, 
the  commission  say : 

It  must  be  remembered,  too,  that  this  country  is  1  argely  a  creditor  country,  of 
debts  payable  in  gold,  and  any  change  which  entails  a  rise  in  the  price  of  corn- 
modities'g^nerally  ;  that  is  to  say,  a  diminution  of  the  purchasing  power  of  gold 
would  be  to  our  disadvantage. 

Before  the  British  Royal  Commission  of  1863  on  International 
Coinage,  Mr.  Jacob  Behreu,  an  eminent  British  merchant  aud  mem- 
ber of  the  Associated  Chambers  of  Commerce,  after  answering  special 
aud  technical  questions,  was  asked,  in  conclusion,  "if  there  was 
anything  else  he  wished  to  state."  His  reply  was  (p.  13) : 

I  would  only  state  that,  in  my  opinion,  the  general  introduction  of  gold  all  over 
the  world  has  been  one  of  the  greatest  possible  blessings  to  England.  I  believe 
that  England  would  bo  now  the  very  poorest,  country  in  the  world  if  the  silver 
standard  abroad  bad  been  kept  up,  and  gold  had  wot  been  generally  introduced. 
Gold  would  otherwise  have  been  verj' much  red  uc.efl  in  value,  and  we  should  have 
had  all  the  gold  poured  into  England.  All  the  debts  owing  to  us  would  have  linen 
paid  in  the  depreciated  currency:  and,  therefore.  I  believe  that  England  ought  to 
have  taken  the  lead  in  the  introduction  of  a  gold  currency  abroad.  We  ought  to 
be  very  thankful  that  it  has  been  introduced,  and  we  ought  to'give  every  facility 
to  its  circulation. 

Sir  Lyon  Playfair,  in  a  speech  delivered  in  the  English  Parliament 
on  April  18,  1890,  according  to  the  report  in  the  London  Times  of 
the  day  following,  said  that — 

The  true  policy  of  England  as  the  chief  creditor  nation  of  the  world  was  to  keep 
perfect  independence,  aud  to  refuse  participation  in  any  entangling  conference 
on  our  monetary  system. 

And,  according  to  the  same  report,  Sir  Lyon  Playfair,  referring  to 
the  holding  of  the  metals  together  by  law,  said  that — 

It  was  quite  true  that,  if  you  yoked  a  cart-horse  to  a  racer,  the  strength  of  roth 
would  be  increased  but  the  speed  of  the  racer  would  be  sacrificed. 

Gold  is  the  "  racer"  whose  "  speed  "  must  not  be  sacrificed,  no  mat- 
ter how  much  injury  may  be  effected  by  its  tendency  to  greater  and 
greater  gain. 

The  weight  of  the  enormous  burden  which  is  imposed  ou  gold  can 
not  be  better  illustrated  than  by  a  statement  of  this  same  Sir  Lyon 
Playfair,  made  in  the  same  speech.  According  to  the,London  Times 
of  April  19,  he  said  that — 

The  liabilities  of  the  banks  of  Great  Britain  to  the  public  amounted  to  £621,- 
000,000,  or  about  the  amount  of  the  national  debt  of  England  ;  but  the  amount  of 
coin  or  bullion  to  meet  this  liability  was  only  £35,0. '0.000;  or,  deducting  from 
each  side  of  the  account  £8,000,01)0  locked  up  in  the  Xotes  Department  of  the 
Bank  of  England,  it  was  £27,000,000;  or  only  4J  per  cent,  of  liabilities. 


On  the  same  occasion  Mr  ncellor  of  the  i 

:vd  an  able  speech,  in  which  he  jjave  his  facts,  his  clou 
and  his  loojc   to  tin-  stni^^lin-.1  mntryinen  by  main- 

taining the  wicdom  of  remonetiaatios  of  eilver.  but  t;ave  liis  conclu- 
.ind   his  policy  to  the  creditor  cla->-e->   by   recommending  no 
disturbance  of  present  conditions. 

I  hare  contended  — 
said  the  Chancellor  of  the  Exchequer— 

ami  am  prepared  utill  to  contei;..  ild  prvf-r  the  currency  of  the  wor'd 

ml  upon  two  nji'taU  rathiT  t!;  nn-ta!.     'l«  tliiwi*  vi.-w  - 

•     •     •     I  havt-  always  looked   up   : 

aut  icmiUtic   U>  e«Ob  Other ;  Dot  M  lx  -'..i-  jirii.-fni'  .•  i  would 

neoesaanly  fall  when  tluM>th.-t  ruse.  Inn  I  bftYe looked  ujiou  them  as  partueis  who 
Lii^.-tber  were  dninj:  the  work  of  tlu-  currency  of  tho  world. 

The  English  creditor  classes  hav--  not  l»-.-n  without  able  coadjutors 
in  this  country.     \V«-  have  noticed  for  tin-  last  twelve  or  lu 
:  hat  zealous  advocates  of  the  jjold  .standard,  the  advaii! 
\vliich  ar?  not  confined  to  Great  Britain,  ;vre  to  be  found  among  the 
creditor  classes  of  the  United  Si 

If  the  toilers  of  this  country,  from  the  proceeds  of  whose  lab.»r  th»-si- 
exactions  have  to  l>e  paid,  hail  as  little  influence  on  the  legislation  of 
the  United  States  as  the  toilers  of  England  havr  on  the  l.-u-Nbiiion  of 
that  country,  the  creditor  classes  and  financiers  of  tin-  I'nited  - 
mi^ht  be  :w  frank  as  those  of  (Jreat  Britain  in  admitting;  the  object  of 
maintaining  the  single  ^old  standard. 

Hnw  yraphieally.  though  unintentionally,  ii' 

: .  in  the  following  verse,  expre.vs  tile  advanla^.-  \\  h 
standard  j^ivrs  to  cn-ditor.sev.-n  \\  here,  ami  th.  ..'tiou  with 

which  they  contemplate  lit'.-  : 

Tin-  taste  of  hot  Anilii.i  - 

•liiiX  sun  thai  in..'. 
Without  th>-  worm,  iii  ! 
An.  .iiitin;.  iir'.-. 

On    - 
We  ; 

THE  MOT  I 

When  Germany,  into\icat.-d  liy  h.  ;,d   in 

- 

by  tin- fall  of  pn<  i.  nt  mi  the  incp-a.se    • 

than  all  her  armies  of  horse  and   I'MO;  hail    In-.-n   .il»b-  t.i 

.-.     I'rance,   on   the  . 

iinpn-cc.lentrd  war  tribute,  by  '.  ,.-nt  voluiih 

ilatio.'i  to  maintain,  and  even  advance,  h.-i    : 

the ^reai . 

::illph    Ilioi'i'  coiil]ile!c   thall  (iellliaiiy 

•  d  by  ail   tin-  military  >pl«Mi>!nr  of  the  war.     The  laiisoui 

ind  nst  ry.      Ii 
prosptrity.   Mr.    P  when   hniulteds  (>!'  i  lion-iinds  oi   i 

•1   annual 

ing  ;  a  M'-'ii  ion. 

rliat  as  MMHI  as  tip-  i-;)ei  ;>  n<   d-Ti.im-t  :/.it  i-m  of  silver  Ind  had  t';n.- 
to  ma.. 


From  1873  to  1869,  the  emigration  from  Germany  numbered  1,546,- 
000  persons. 

Students  of  social  science  everywhere  recognize  the  statistics  of  ille- 
gitimacy and  of  suicides  as  among  the  most  powerful  evidences  of 
monetary  distress.  By  reference  to  those  statistics  we  fiud  that  not- 
withstanding the  large  emigration  during  that  period  the  number  of 
illegitimate  births  in  Germany  increased  from  161,294  in  1833 'to  169,- 
645  in  188d ,  The  suicides  in  Prussia,  Bavaria,  Saxony,  and  Baden — the 
leading  states  of  the  German  Empire — increased  from  179  for  each 
million  of  population  in  1868  to  196  for  each  million  of  the  population 
in  1876  and  to  218  for  each  million  of  the  population  in  1662.  Jn 
Prussia  alone  the  number  of  suicides  in  1876  was  151  per  million, 
while  in  1882  it  was  191  per  million. 

This  is  part  of  th=5  price  which  the  toiling  masses  of  German}7  are 
paying  for  the  gold  standard  experiment,  which,  without  their  con- 
sent their  imperial  government  foisted  upon  them. 

Bismarck  made  the  mistake  that  many  able  men  in  all  countries 
of  the  western  world  have  made  and  continue  to  make,  namely,  that 
of  attributing  the  commanding  position  of  Great  Britain  in  the  com- 
mercial and  industrial  world  to  her  adoption  of  the  gold  standard. 
Bismarck  mistook  for  cause  and  effect  what  was  a  mere  coincidence, 
the  result  of  exceptional  conditions,  as  did  those  of  our  legislators 
in  1873,  who  happened  to  know  anything  whatever  of  the  nature  of 
the  act  demonetizing  silver.  The  belief  of  some  of  the  most  far- 
lighted  statesmen  of  Great  Britain  has  been  that  she  secured  her 
position,  not  by  reason  of  the  gold  standard,  but  in  spite  of  it. 

In  a  speech 'delivered  at  Glasgow,  in  November,  1873,  after  the 
alteration  by  Germany  in  her  monetary  standard,  Mr.  Disraeli  said: 

The  monetary  disturbance  which  has  occurred,  and  is  now  to  a  certain  extent 
actiug  very  injuriously  upon  trade,  I  attribute  to  the  great  changes  which  the 
Governments  of  Europe  are  making  in  reference  to  their  standard  of  value.  Our 
gold  standard  is  not  the  cause  of  our  commercial  prosperity,  but  the  consequence 
of  that  prosperity.  It  is  quite  evident  that  we  must  prepare  ourselves  for  great 
convulsions  in  the  money  market,  not  occasioned  by  speculation  or  any  of  the  old 
causes  which  have  been  alleged,  but  by  a  new  cause  with  which  we  are  not  suffi- 
ciently acquainted. 

And  again  in  March,  1879,  when  the  effects  of  the  decreasing  vol- 
ume of  money  were  making  themselves  more  and  more  felt,  Mr.  Dis- 
raeli, then  Lord  Beaconsfield,  said : 

All  this  time  the  produce  of  the  gold  mines  of  Australia  and  California  has  been 
regularly  diminishing,  and  the  consequence  is  that,  while  these  great  alterations 
on  the  continent  in  favor  of  a  gold  currency  have  been  made,  notwithstanding  .that 
increase  of  population  which  alone  requires  a  considerable  increase  of  currency  to 
carry  on  its  transactions,  the  amount  of  the  currency  itself  is  yearly  diminishing, 
until  a  stat-e  of  affairs  has  been  brought  about  by  gold  production  exactly  the  re- 
verse of  that  which  it  produced  at  first.  Gold  is  every  day  appreciating  in  value, 
and  as  it  appreciates  the  lower  become  prices.  It  is  not  impossible  that,  as  affairs 
develop,  the  country  may  require  that  some  formal  investigation  should  be  made 
of  the  causes  which  are  affecting  the  value  of  the  precious  metals,  and  the  effect 
which  the  change  in  the  value  of  the  precious  metals  has  upon  the  industries  of 
the  country,  and  upon  the  continual  fall  of  prices. 

In  reaching  their  conclusions,  Bismarck  and  others  ignored  the 
fundamental  principle  that  a  gold  supply  that  might  be  sufficient 
for  one  country  with  a  gold  standard,  and  might  even  result  in  a 
measure  of  prosperity  to  that  country,  would  be  wholly  insufficient 
if  other  countries  should  adopt  the  same  standard  and  should  enter 
upon  a  keen  competition  and  rivalry  for  the  acquisition  of  gold. 

The  adoption  of  that  standard  by  Germany  and  France  was  there- 
fore not  only  destructive  of  their  own  prosperity,  but  was  a  stun- 
ning blow  at  the  prosperity  of  England  and  all  other  gold-using 


L'O 

countries.     In  taking  England  for  bis  model,  Hismarck  had  uot  the 
condition  of  the  toiling  masses  before  his  mind,  but  the  glamour  of 
prosperity  which  surrounded  tin'  creditor-barons. 
Tin-  unprejudiced  observer  can  not  fail  to  perceive  that  the  $370,- 

coinril  miller  tin-  Limited  ComaiM-   Act  of  the  I'nited   - 
of  1-?-,  supplementing    tin-  gold   .stock  of  tho    western  world  . 
poned  great    industrial    and    financial    crises.      I'.nt    tin-  clenx 
these.  ^.-ithcriug,  and,  unless  relief  be  soon   forthcoming, 

will  burst.  upon  the  world  with  crushing  severity. 

DEMONETIZATION    IN  TliK   IA1TKD  STATES. 

If  we  are  surprised  that    the  .sordid  selfishness  of  tlie  privileged 
classes  of  Ktirope  should  haveindneed  tin-nit.)  perpct  rate  tso  gross  an 
\  e  are  retninded  that  the  legislation  «if  monaichical 
count  :  ..illy  been  controlled  in  the  interest  of  the  pri\ 

classes.  Hut  what  shall  be  said  in  defense  of  the  demoncti/atinn  of 
silver  by  the  United  Status!  No  such  stupendous  act  of  lolly  and 
injustice  was  ever  before  perpetrated  by  the  representatives  of  a 
free  people. 

Our  position  differed  materially  from  that  of  CJreat  Britain.     This 

was  not  a  creditor  nation.     Our  people  did  not,  and  do  not,  own  thous- 

ands of  millions  of  dollars  of  foreign  bonds,  on  whicl  <emi- 

ani.ual    int»-nvst  in  a  constantly  appreciating  money,  which  would 

0  be  paid  from  the  current  earnings  of  foreign  labor,     li 

•re,  of  our  <lemoncti/ation    unjustly  cmii-hing  our  cic.litor- 

da.sses  at  the  ex|iense  <if  foreigners,  it   •  nabled  the  en  ditors  at  home 

•  rob  and   despoil   tin-  debtors  among   their  own  countrymen. 

d  of  despoiling  the  Canadian,  the  Australian,  the  Kast  Indian, 

\  ptiaii,  or  the  Turk,  the  apoliatioo  airan^i.l  for  b\  our  adop- 

tion ofthejjold  .standard  was  a  spoliation  of  the  il.-l.toi-,  in  our  o\\  n 

communities.     In  so  far,  however,  as  our  debt  was  held  abroad,  it 

provided  for  a  spoliation  oi  our  ciii/ens  by  the  fun-inn  bondholders 

also.     And  as  nearly  all  our  public    debt'was  so  held,  we  hail  pre- 

sented to  tis  in   1-?:?  the  extraordinary  spectacle  of  n-pr« 

wnt  here  to  enact  laws  for  the  we]  fan-  ami  advancement  of  our  own 

people,  devoting  all   their  em-r^ics.  whether  awan-  of  it    or  not,  to 

the  upbuilding  of  the  fort  lines  nf  the  moneyed  ai  istocracii-s  of  other 

at  the  expense  of  the  producers  of  the  Tinted  States. 

coxurriox  or  THE  COUKTKY  AT  THE  TIME. 

Consider  for  a  moment   the  condition  of  this  country  at   the  time 
when  this  ania/inn  piece  of  legislation   \\asi-uacted. 

i.'epiibhe  was   but    j  ;  riii^   from  ati   i-xhan 


...aded   it    with  a  national   debt    approaching  $;<,(KKi.(HK},000. 

also  State,  county,  city,  and  town   debts  a 
:n«re  thousands  Of  million*,  With  railroad  and  other  corp,,  rate 
.ind  del.  is  Jiyyre^ating  yi-t   other    thousands  ol'  millions  and 
te  debts  ot  and  uuiisccrtainalde  amount,  represented 

by  mortgages  on  real  estate.  This  constituted  M 
whose  ImnliTi  miglit  naturally  be  jiresumed  t<»  bo  sulb- 
all  the  TV-'  -In-  pi-opl,-.  Although  some  portion  of  those 

!ia«  IR-CII  Mi|indatei|  and  the  national  In.  mis  have  been  refunded 
at  lower  rates  of  intercut,  yet  we  all  know  that  in  Ibis  »•;«•  all  muni- 
cipal n  :  .it«  debts,  if  not  national  delits,  are  prad  cally  p<-r- 

MII  of  bond  liquidated  than  am.th.  : 
"•e;  no  sooner  is  ouo  public   improvement    completed  thaji  an- 

-iiii. 
At  ti  ver  wasdemoiieti/.e<|  it  might  well  have  been  snp- 


27 

posed  that  a  sufficiently  largo  unearned  increment  had  already  been 
realized  by  the  foreign  aud  domestic  holders  of  United  States  bonds. 
The  greater  portion  of  the  debt  of  the  Government  was,  when  in- 
curred, made  payable  simply  in  "  lawful  money  " — the  interest  alone 
being  payable  in  coin.  Yet  in  March,  1869,  the  bond-holders  secured 
the  passage  of  an  act  of  Congress,  entitled  "An  act  to  strengthen  the 
public  credit,"  containing  a  pledge  to  pay  in  coin  or  its  equivalent 
riot  merely  the  interest,  but  the  principal  of  all  national  obligations 
not  specially  provided  to  be  paid  otherwise. 

THE  COURSE  OF  THE  CREDITORS. 

And  again,  when  in  1370  Congress  was  about  to  provide  for  a  re- 
funding of  the  public  debt,  these  clamorous  creditors,  not  satisfied 
with  having  got  the  bonds  at  rates  much  below  their  face  value,  and 
not  satisfied  with  the  pledge  to  pay  in  coin — a  pledge  made  long 
alter  the  contract  was  made  and  the  debt  incurred — insisted  that 
not  only  should  the  new  bonds  be  payable  in  coin,  but  in  order  to 
guard  against  any  possible  interpretation  which  might  work  to  their 
detriment  they  did  what  has  rarely  been  done  in  the  history  of  mon- 
etary legislation,  insisted  that  even  the  very  standard  of  that  coin 
should  be  fixed  and  nominated  in  the  bond.  They  were  willing  to  take 
no  chances.  They  were  not  willing  to  place  confidence  in  the  sense 
of  equity  and  fair  dealing  of  the  people  of  the  United  States.  They 
held  before  Congress  the  covert  threat  that  if  the  new  issue  of  bonds 
did  not  provide  for  payment  in  "  coin,"  instead  of  "  lawful  money," 
and  did  not  prescribe  the  precise  standard  of  coin  in  which  they 
were  to  be  payable,  it  would  be  difficult  if  not  impossible  to  place 
the  bonds  on  the  market. 

So,  by  the  refunding  act  of  July  14,  1870,  Congress  provided  for 
the  payment  in  "  coin  of  the  present  standard  value,"  that  is  to  say, 
in  either  gold  dollars  of  25.8  grains  of  gold,  nine-tenths  fine,  or  in 
silver  dollars  of  4124  grains  of  silver,  uine-tentus  fine,  at  the  option 
of  the  United  States.  But  even  this  extreme  advantage  to  the  credi- 
tors over  payment  in  "lawful  money  "  of  the  United  States,  in  which 
the  bonds  were  bought,  and  in  which  they  were  legally  payable,  was 
insufficient.  All  but  the  most  ingenious  would  imagine  that  having 
thus  provided  for  payment  in  coin  then  bearing  a  considerable  pre- 
mium over  the  current  money  of  the  Republic,  and  having  the  very 
standard  of  that  coin  fixed  in  the  act,  the  highest  point  of  vantage 
had  been  reached.  One  device,  however,  and  only  one,  remained  by 
which  the  money  of  the  payment  could  be  still  further  increased  in 
value,  and  this  device  did  not  escape  the  watchful  eye  or  cunning 
hand  of  the  public  creditors. 

They  clearly  saw  that  if  by  legislative  enactment  they  could  se- 
cure the  rejection  of  one  of  the  money-metals  they  would  succeed 
in  enormously  increasing  the  value  of  the  metal  retained.  This  they 
accomplished  by  the  demonetization  of  silver,  and  thus  by  striking 
down  one-half  the  automatic  money  of  the  world  and  devolving  the 
money  function  exclusively  on  the  other  half,  added  thousands  of 
millions  of  dollars  to  the  burden  of  the  debt. 

THE  PRETENSE  TO  "STRENGTHEN  THE  PUBLIC  CREDIT." 

It  will  be  observed  that  this  anxiety  to  strengthen  the  public 
credit  was  evinced  by  the  bondholders  after  aud  not  before  the 
bonds  were  in  their  possession.  No  anxiety  for  the  public  credit 
was  manifested  by  them  at  a  time  when  the  Government  might  be 
able  to  reap  adva'ntage  from  it.  The  Government  having  parted 


with  the  bonds:,  discount,  theirselliiu  price  in  the  market 

became  a  matter  of  no  direct  pecuniary  importance  to  tin-  people  of 
tin-  I'nitt 

The  ••  Mrengthenini:  of  the  pnlilic  credit"  that  was  to  be  effected 
l>y  tin-  act  <'l    March  !  .;isisted  of  a  rise  in   tin-  price  of  the 

tortlie  benefit  of  tin-  holder,  at  a  tiim-  when  they  \vtTt>  no 
longer i he  nrop«Tty  of  tin-  (Jovernmeiit  lint  of  private  individuals. 
.ii  etVcct  of  the  act,  therefore,  was  not  in  any  way  to  hem-tit 
the  Government  tmt  greatly  to  enrich,  by  an  increment  unearned 
and  unbargained  for,  a  few  nu>n  \vhobail  already  been  greatly  en- 
rich, -d  by  their  dealings  with  the  United  States.  '  The  title  of  the 
art  >houhl  have  read  '•  An  act  to  strenghten  the  bank  account  and 
credit  of  the  holders  of  United  States  bond*." 

The  excuse  and  apology  for  the  act  was  that  by  i;s  passage  the  re- 
funding process  then  contemplated,  and  afterward  provided  for  by 
the  refunding  act  of  1-70  might  be  rendered  more  certain  of  success; 
but  if  any  advantage  accrued  from  that  cause,  it  was  lost,  and  nun  h 
more  with  it,  by  the  inerea.se  which  the  act  of  IBo'J  eilecicd  in  the 
burden  of  the  bonded  obligation,  by  pledging  rhe  nation  to  a  pay- 
ment in  a  medium  much  more  valuable  than  the  medium  provided 
for  in  the  contract.  And,  again,  in  Ir73  when  all  the  bond*  provided 
for  by  the  refunding  act  of  1-70  had  beeu  sold  and  had  passed  on'  of 
the  hands  of  the  Government,  another  act  \\  a*  passed,  intended  by  the 
money-lenders  again  to  strengthen  the  public  credit,  an«l  again  to 
the  disadvantage  of  the  people  and  to  the  exclusive  and  enormous 
advantage  of  the  bondholders.  It  bore  the  innocent  title  of  "An 
act  revising  ami  amending  the  laws  relative  to  the  mints,  assay  of- 
fice*, and  coinage  of  the  United  States."  This  act.  hearing  on  It 
no  suggestion  of  any  change  more  serious  than  that  of  regulating  tip- 
is  of  mint  management,  has  proved  to  be  an  act  of  mo. 
nientous  consequence  to  the  people  of  this  country.  Th.- 
tliat  demoneti/ed  the  silver  dollar,  which  it  did  by  merely  omitting 
in  from  the  enumeration  ot  the  coins  of  the  Uni: 

DEMONETIZATION   WHOLLY   fNJUSTIFIARLK. 

Among  all  the  explanations  that    li  made   to  account    tot- 

that    denioiii-ti/ation    by  .1  of   the    United    States.    I    have 

i  any  reason  advanced  which  constituted  a  Justin. 

for  it.     To  my  mind,  in  view  of  all  lh<>  circumstances— in  tin-  ; 

the  herculean  uiiiiculties   by  \\hich    the   :  -    MM  round'  d.  in 

tbe  face  of  the  .sacrifices  which  our  eiti/.ens  had   made   to  p; 

:ild:c.  :iiid  in  the  fac«  of  all  that  had  already  b.  en  don-- 

IS  I'foplr,  Jiroud  of    tin-it    liation:ii    sl|.  ngtll,   and    :• 

of  their  national   honor,   to  satisfy   the    i  •  of  the 

--ay,  of  all  these  la.  is.  the  demon, -t 
I  he  Unit-  -ne  of  tip. 

at  are  worse  than  .  -.vus  tin-  cliil.l 

.  I  ice.    ami  .lit     of    en 

•  •*  far  as  possible  the  the  blunder  of  l-?:t 

that   new  legislation  d.-mamled    by  the  people. 

While  tho   pasi  <aii   not  .,!     >   ..ins.  ;i:nl    tlm 

pressing  du  •;,,    i.;;m.-.     The  demand 

cotuefl  from  all  '  .it   a  i.  •!..-•    toi    t!i>-  >le- 

preMed   iml  u  of  14 

applied    at    tin-    .                                  -.      And  what    bett.-r  \,-<- 

•.ied  than  absolutely  to  reverse  that  legislation  .t  ..i  to  put  th.- 


20 

monetary  position  of  this  country  back  to  exactly  w  here  it  was  when 
that  wrung  was  committed? 

Some  twelve  years  ago  an  attempt  was  made  to  apply  a  remedy, 
but  the  attempt  was  only  partially  successful.  Instead  of  resulting 
in  free  coinage,  it  resulted  in  the  passage  of  the  bill  which  author- 
ized the  coinage  of  not  less  than  two  nor  more  than  four  million  dol- 
lars' worth  of  silver  per  month.  On  that  occasion  a  financial  debate 
of  great  interest  and  importance  was  had  in  this  Chamber  and  in  the 
other  House  of  Congress.  The  proposition  to  reraonetize  silver  or 
to  increase  the  silver  coinage  was  vigorously  opposed,  but  the  argu- 
ments then  presented  by  the  advocates  of  reuionetization  never  have 
been,  and  never  can  be,  refuted. 

In  fact,  but  rarely  has  there  been  any  attempt  made  to  answer 
those-arguments.  Puerile  attempts  at  wit,  and  diatribes  of  abuse  are 
all  that  the  silver  men  have  heard  iu  sixteen  years  in  answer  to  the 
contentions  they  have  made  in  favor  of  the  remouetization  of  silver, 

EDUCATIONAL  EFFECT  OF  DISCUSSION. 

With  that  debate,  Mr.  President,  long  pending  and  eagerly  main- 
tained on  both  sides,  there  began  in  this  country  an  educational 
movement  among  the  masses,  that  is  destined  to  have  far-reaching 
consequence.  The  public  attention  was  fastened,  as  it  had  never 
been  fastened  before,  on  the  subject  of  money,  and  on  the  forces 
•which  govern  its  value,  and  up  to  this  time  that  attention  has  never 
flagged.  As  a  result  we  find  the  great  body  of  ourpeople  to-day — the 
farmers  and  artisans  of  the  country — after  years  of  reflection  and  dis- 
cussion in  their  lyceums  and  trade  organizations,  adopting  to  a  large 
extent  the  views  then  presented  by  the  advocates  of  an  increased 
money  volume — views  which  at  the  time  were  contemptuously  de- 
rided by  the  advocates  of  contraction  and  of  gold. 

The  cry  for  relief  appropriately  now  comes  from  the  farmers,  the 
artisans,  and  the  laboring  classes,  as  well  as  from  the  young,  the 
enterprising,  the  thoughtful,  of  all  classes,  who  have  not  inherited 
•wealth,  but  are  hewing  out  for  themselves  the  rugged  path  to  suc- 
cess. It  is  they  who  have  had  to  bear  the'  exactions  of  the  system 
which  has  prevailed.  It  is  from  the  proceeds  of  their  labor  that  the 
extortions  have  been  paid.  If  objection  be  made  that  the  character 
of  relief  proposed  is  not  indorsed  in  financial  circles,  or  by  the  liter- 
ary guild  or  professional  political  economists  that  surround  them, 
the  sufficient  reply  is  that  the  world  can  not  wait  for  the  correction 
of  abuses  by  those  who  are  profiting  by  them.  In  the  nature  of 
things,  all  movements  for  reform  must  be  initiated  by  those  who 
can  not  lose  by  the  installation  of  justice. 

But  there  are  others  besides  the  laboring  masses  who  are  working 
in  the  cause  of  humanity.  There  are  noble,  unselfish,  and  altruistic 
men  in  all  the  countries  of  civilization,  who  see  the  wrong  and  are 
indefatigable  in  their  efforts  to  set  it  right. 

I  will  read  a  cable  dispatch  recently  addressed  to  me  by  Mr.  Henry 
H.  Gibbs,  formerly  governor  of  the  Bank  of  England,  and  now  pres- 
ident of  the  Bimetallic  League  of  Great  Britain : 

LONDON,  May  6. — The  friends  of  silver  deeply  regret  the  death  of  Senator  Bpck, 
whose  services  in  the  cause  of  monetary  reform  are  most  warmly  appreciated  on 
this  side  of  the  Atlantic.  The  bimetallist  party  of  tte  United  Kingdom,  now 
including  over  one  hundred  members  of  the  House  of  Commons,  attach  the  greatest 
value  to  the  debate  about  to  commence  in  your  illustrious  chamber.  Vv~e  fully 
recognize  not  only  that  the  support  afforded  to  silver  by  your  legislation  during 
the  last  twelve  years  has  helped  to  protect  the  industrial  world  from  an  acute  mon- 
etary crisis,  but  also  that  the  debates  in  Congress  have  served  more  than  all  _else 
to  educate  our  people  to  recognition  of  the  important  issues  involved.  We  believe 
JONES 


30 


also  that  th«-  increase  and  coinage  of  silver  rout  ernpl.i'ed  l>y  < 
wholly  »r  c"iiMderably,  your  i  •  ^  ill  thus  inaki-  nit 


Mr.  Moreton  Frewen,  of  London,  an  able  writer  on  economic 
subjects,  whose  recent  work  on  the  "The  Economic  Crisis"  I  com- 
mend to  the-  careful  perusal  of  Senator-,  says: 

It  may.  indeed,  be  affirmed,  without  fear  of  contradiction.  that  'lesUlat  ion  ar- 
ranged  iu  the  intei.  .in  class.  tirat  by  Lord  I  Ibil  country. 

auil  ajcain  by  Sir  Robert  IVelat  theinsti-an.inot  M  i.  I  one*  I.UM!  apd  other  wealiliy 

-  MipplemcnUMi  recently  by  simultaneous  antisih  . 
IL   I'.t-ilin  and  Washington   ut  the    instance  <-t  the   1:1  cat    rir.anci.i. 

:uu  ban  about  doubled  tin-  burden  of  all  national  debts  by  an  artificial 
i  iih.iiicenient  of  the  value  of  money. 

Tin-  fall  of  all  prices  induced  by  this  cause  bns  been  on  sucb  a  Re»le  that  while 
in  twenty  years  the  National  debt  of  the  I'nited  St:it,  s  ,  pi  ted  in  dollars  • 

d  by  nearly  t  »  o-thirds.  yet  the  value  of  the  remaining  on.-  -third,  measured 
in  wheat,  in  bar  iron,  or  bales  of  cotton,  U  en: 

demand  draft  on  the  labor  and  industry  of  tlie  nation  tlnin  w«-  tlie  whole  di-lit  at 
/ranted.    The  aggravation  of  the  burdens  <>i  taxation  induced 
tppreeUtionofeold,"  which  is  no  natural  a]i|iri-ciation.  but  has 
I'l-eri  brought  about  by  class  legiaUtlOfl  to  inclease  tin*  value  <.t"  the  ^old  .v 
Hiires  but  to  be  explained  to  an  enfranchised    den-. 

which  will   know  bow  to  protect  Itself  again*!   t'unli.i   .uti-miits  io  conir.u-t  the 
ncy  and  to  force  down  prices  to  the  cont'mion  of  <-\  «  r\  i-\ii«t:n^  c-.n; 

claasea  of  middle-men,  banker-  have  b.-i-n  by  t'.n-  the  most  successful  in 
unl  appropriating  an  undue  shar»-  of  pi-mluced  wealth      \Vlii'.-  ih.- 
•:,  ot  banktnic  and  credit  may  be  said  to  be  even  \et  in  ltd  i 
•-  of  the  community  which  is  to-day  in  the  ntron_ 
15  would,   if  declared,   be  an'nstoiindin^   revelution   of   ih. 
jiarticular  Imsiness;  and  not  onlv  has    he  bu.siiiesi  Itw 
•  ••  inntioiiiily.  but  it-*  inli-r.'sts  in  a  very  few  hands  are  uiametncally 

lal  interests  of  the  mniority.  -n   intends: 

tra-  r  the  currency  and  force  down  all  prices,  including  vvaces.  th-  \n  :<  ••  paid  for 
IUT  has  been  able  to  increase  the  p  i»  sov- 

diminution  of  the  price  of  every  kind  of  pro]  .  rt  \ 
nu-nsured  in  i: 

tWFUI.KILI.EI)    1-KDfHECIE*. 


l>;irinjj  the  debate   on  the  limited  eniii:i^i-  liill,  not  content  with 
abuse  (if  the  a«l  with   llun>\  criti.  i-.rn  of  it 

M  iU-Kiiinents  arjait^t    it.  its  opponent*  in  and  out  of  Con  - 
.  divi-rs  jirophi-cies  and  predictions.     They  pirtnn  <1 
forth  the  laiiieiitalil.-  n-.nl  :s   that   would  follow  it.s  pa>.-.ai:«'.  and  the 
din-fill  riinse«|in-nre.s  that  would  ensue  from  an  increase  of  tin 
ni'-dinm  of  th<-  fonntry       Amonn  the  n--ults  nmlidfiit 
\\ere   the  follow  in<;  :   that    the  silver   would   not   Hrm 

tin    that  it  would  circulate  to  t  In    «-\i  hiMoli  of  ^old,  whirh 

ntMi-iiied,  would  tlo\v  rint  <if  t  his  roitnl  ry  wit' 
md  in  a  voliunethrretofnie  unknown:  that  we  should  lie  unable 
ir  paper  money  in  x"'-d  :  tliat  we  shmild  be  pie<  ipitated 

tliat   ail  inllatiotl  of  the  cuneln  \    woii'd    ! 

Of  nil  cominoilit  ies  and  that  this 
inflation  would  resn  It   in  an  nnpie<  ctlcnteil  .  mitiaetion.     ^ 

•  <lit«>rs  a  dollar  worth  only 

\Ve     \v  of  the  bill  would 

postpone    the    refunding  of  the    ]nil.l:i  •  debt,   nild    WiHlld 
mil   linpHi:  6  of  otir  11:1  1  uni.i  1  sei-nritu 

• 

diutry—  tl 
atuiti;  targed  with  nttving  :  with 


31 

lowering  the  standard  of  American  credit;  with  tarnishing  the 
integrity  and  honor  of  our  country  before  foreign  nations,  and  with 
unprecedented  moral  turpitude  insetting  au  example  of  flagrant  and 
shameless  national  dishonesty. 

The  men  of  the  far  West,  and  of  the  Pacific  slope  especially,  were 
the  particular  targets  of  this  abuse.  They  were  denounced  by  some 
as  "  lunatics,"  by  others  as  dangerous  and  unworthy  demagogues,  be- 
canse,  as  was  charged,  their  constituents,  if  not  themselves,  were  di- 
rectly interested  in  the  restoration  of  the  ancientright  of  silver  to  fall 
recognition  as  one  of  the  money  metals.  For  their  benefit  resort  was 
had  to  every  epithet  which  the  English  language  afforded.  In 
holding  them  up  to  public  scorn  the  rich  and  varied  vocabulary  of 
odium  and  opprobrium  was  exhausted. 

These  prophecies  of  disaster  were  united  in  by  the  professors  of  po- 
litical economy  in  all  the  Eastern  colleges,  by  the  President  of  the 
United  States,  by  the  Secretary  of  the  Treasury,  by  the  leading  Amer- 
ican newspapers,  by  the  principal  public  men  and  journals  of  Great 
Britain,  if  not  of  all  Europe;  and,  of  course,  by  all  bankers,  money- 
lenders, and  professional  financiers  the  world  over. 

And  now,  Mi.  President,  how  many  of  all  those  alarming  prognos- 
tications by  all  these  distinguished  prophets  have  been  fulfilled  ? 
Not  one!  On  the  contrary,  it  is  not  too  much  to  say  that  the  pub- 
lic credit  of  the  United  States  is  to-day  the  highest  in  the  world.  It 
does  not  stand  merely  in  line  with  that  of  other  first-rate  powers  ; 
it  stands  at  the  head.  Our  gold,  silver,  and  paper  money  stand  at 
a  parity  with  each  other.  If  a  full  measure  of  relief  was  not  realized 
by  the  passage  of  that  bill  it  is  because  the  coinage  of  $4,000,000  a 
month  was  left  optional  with  the  Secretary  of  the  Treasury,  instead 
of  being  made  mandatory  on  him. 

But  it  is  hardly  necessary  to  assert  that  the  predicted  inflation  of 
prices  has  not  been  observed  as  a  consequence  of  thecoinage  of  $2,000,- 
000  a  month.  While  the  issuance  of  that  amount  has  not,  with  our 
rapidly  increasing  population  and  wealth,  been  sufficient  to  arrest 
the  downward  tendency  of  prices,  it  has  undoubtedly  prevented  them 
from  falling  much  lower.  Without  that  coinage,  we  should  have  had 
industrial  depression,  chronic  and  somber,  with  consequences  of  un- 
told  disaster. 

But  the  result  which  gave  most  apprehension  to  those  who  advo- 
cated the  gold  standard,  the  evil  which  they  regarded  as  on  tue  whole 
the  most  threatening  and  direful  of  all  the  evils  that  were  to  result 
from  even  so  small  an  increase  in  the  money  volume  as  that  bill  pro- 
vided for,  was  the  outflow  of  gold.  They  ridiculously  under-esti- 
mated the  tremendous  money-absorbing  power  of  this  great  country. 
And  as  if  to  emphasize  to  all  the  world  the  complete  absurdity  of 
their  alleged  fears — this  apprehension  has  been  conspicuously  and  no- 
toriously set  at  naught  by  the  constant  inflow  of  gold.  On  the  30th 
of  June,  1878,  the  amount  of  gold  coin  and  bullion  in  the  Treasury 
and  in  monetary  circulation  in  this  country  is  officially  reported  to 
have  beeu  $>'Ji:?,  199,977,  and  this  amount  is  probably  much  over- 
estimated. On  November  1,  1889,  we  had  more  than  three  times  as 
much — the  amount  of  gold  in  circulatioa  and  in  the  Treasury  being 
reported  as  $1^89,000,000. 

"  Experience,"  says  Dr.  Johnson,  "is  the  great  test  of  truth,  and 
is  perpetually  contradicting  the  theories  of  men,"  and  the  last  ex- 
perience, Mr.  President,  is  the  best. 

If  the  professors  of  political  economy,  the  Eastern  newspaper  ed- 
itors, and  tue  professional  financiers  were  then  so  seriously  mistaken 


•     ought  they  not  to  be  a  little  m>'  .redictioi. 

.ally  in  renewing  predictions  tl  Ij  di-credi: 

They  can  not  point  To  a  \!iich  their  prophesy  ha-. 

-  tied  i»y  the  event.    So  hutoilvtting  a  failure  on.  tln>  part 

of  tht>  professors.  i;i  a  realm  of  wliich  tln-y  boastfully  claimed  to  be 
m. i-  i  .ivvrthrosv  o!"  the>.-  -"  by  men  who 

were  ridiculed  and  derided  as  rural   financier,  an  1   cra/.y  theoi 
ought  to  put   the  advoca'e,  of   the   gold    standard  on   their  guard 
against  a  like  defeat  on  thi-  .     They  are  pressed  for  reasons 

to  account   for  tin-  utter   in  -if  th'-ir  prophecies.   They  arc 

left    without    .1   shadow   of   consolation    except    that  the  eoina^ 

•  rth  of  silver  bullion  each  month  has  not  succeed. -d  in 
placing  silvi-r  at  a  par  withhold.  They  affect  to  believe  that  the 
advocates  of  silver  in  1-7-*  expected  that  th-it  meial,  mnler  the  very 
limited  demand  of  $£,000,000  a  month,  would  lie  brought  to  a  level 
with  gold,  which,  owing  to  the  demonet  i/.ation  of  silver,  had  i 
abnormally  and  ruinously  in  value. 

;eh  belief  was  ever  entertained  or  cxpres.-ed.     On  the  contrary 
it  was  rejieatedly  asserted  by  the   ad  .  silver  that   so  lonji 

:he  entire  yield  of  ^old  from  all  the  mines  of  the  world  (in  i 

$119,000,000)  WM  inve>[»xl  with  the  full ney  function  and  had  tree 

access  to  all  mints  to  be  transmuted  into  coin,  it  could  not  be  expected 
that  the  conferring  of  the  legal-tender  function  upon  a  sum  so  com- 
paratively trilling  as  one- fou rth  the  yield  of  silver  (the  yield  in  1-7- 
being  $119,000,000)  would  have  the  effect  of  placing  it  on  a  level  with 
fold, 

It  is,  however,  a  significant  fact  that  every  silver  dollar  that  has 
been  coined  under  that  act  is  at  a  parity  with  gold,  and  will  to-day 
buy  as  much  of  all  the  objects  of  human  desire  as  will  the  gold  dollar. 
,  more,  silver  bullion — disparaged  and  discredited  as  it  is  by  being 
shorn  of  the  money  function,  and  denied  ai  <•«•-•»  to  the  mints,  instead 
of  decreasing  in  purchasing  power,  has  maintained  so  steady  a  rela- 
tion to  commodities  that  I1'J:  grains  of  uncoined  si Ivi-r  will  exchange 
for  as  much  to-day  as  would  the  coined  dollar,  whether  of  silver  or 
gold,  in  1-7:*,  when  the  full  money  function  altached  equally  to  both 
metal*.  If  this  be  true — and  I  shall  present  ly  demonstrate  it  beyond 
refutation— what  an  utter  p. -rveision  of  terms  it  is  to  say  that  oilvcr 
Las  falleu^n  value! 

WILL  BKMO*KT1ZAT!O.X   PLACE  US  ALOM58IHE   IXI'IA. 

.        We  are  solemnly  warned  that  the  full  remoneti/atioii  of  silver  in  the 

I'i.  -  would  place  us  alongside  India  and  the  other  barbaroiiH 

•lie  world.     This  brilliant  i  .^  is  advanced 

with  ^reat  confidence,  and  is  intended  to  be  conclusive  of  the  argn- 

ni'-nt  ;i gainst  silrer,      lint.  Mr.  Piestdent,  India  \u  no  more  harb.i 

now  than  it  was   [i  ..ur  silver  dollar  \\asdemoiielix.ed. 

India  is  no  more  barbarous  now  than  it  was  in  ]-,")?.  when  (iermany 

:ion«-ti/ed  gold  and  placed  herself  "alongside"  India.      Neither  is 

HOW   than    then.      We  did   not    at    that 

time    hi  i  >:iipl.iint,  either  in   the    I'mte-d   States  or    Ku: 

that  the  iiM-  of  sil  VIM  a-  ni'jney  p!  .  nc  nation  more  than  any 

oth«r  in  da:  iatii«:i    with   the  ci vili/aiion   of  India.      We 

have  never  }>•  vili/atii>i; 

!  niia  by  the  imni'-n^-  i|iiantity  ol  silver 

icr  did  We  hear  it  el:  :i-t   t  he   I  'lilted 

State,   up  to  ]  -;.:  that  we  \\  • 

i>arliaroiiH  nations  by  our  use  of  silver  as  ui" 


33 

Up  to  1834  we  bad  no  metallic  money  other  than  silver  in  our  cir- 
culation, and  up  to  1850  we  had  much  more  silver  in  circulation 
than  gold.  Were  we  "alongside"  India  then?  Where  were  the  wise 
and  patriotic  men  of  our  country  at  those  periods  ?  History  fails  to 
record  any  protest  on  their  part  that  we  were  placing  ourselves 
"  alongside  "  India  or  any  other  of  the  barbarous  nations  of  the  world 
by  our  use  of  silver  and  onr  recognition  of  its  full  money  power.  All 
the  nations  of  the  earth  used  silver  and  accorded  it  full  recognition 
as  money  equally  with  gold  up  to  1819.  Was  a'l  Christendom  at 
that  time  "alongside"  India?  When,  in  that  year,  Great  Britain 
sundered  the  silver  link  that  from  time  immemorial  had  kept  her 
"  alongside"  India  and  the  other  barbarous  nations  and,  for  selfish 
reasons  of  her  own,  arising  from  her  position  as  a  creditor  of  all 
other  nations,  decided  to  recognize  gold  only  as  money,  was  any 
evidence  afforded  of  a  sudden  advance  in  the  civilization  of  Great 
Britain  ?  Was  the  emergence  of  that  nation  from  the  benumbing 
companionship  of  India  and  the  other  barbaric  countries  into  the 
glittering  and  refulgent  light  of  the  gold  dispensation  signalized,  as 
would  be  expected,  by  a  corresponding  improvement  in  the  condi- 
tion of  the  people  ? 

On  the  contrary,  the  history  of  the  time  informs  ns  that  as  a  con- 
sequence of  the  passage  of  the  bill  by  Parliament  in  1819,  compell- 
ing payments  in  gold,  prices  rapidly  fell,  cotton  in  particular  sinking 
in  the  short  space  of  three  months  to  one-half  its  former  level.  With- 
in six  months  all  prices  had  fallen  one-half,  and  showed  no  signs  of 
improvement  for  the  next  three  years.  By  reason  of  the  contraction 
of  the  currency  the  industry  of  the  nation  was  congealed,  as  is  a 
flowing  stream  bv  the  severity  of  an  arctic  winter.  Alarm  became 
universal;  confidence  and  activity  ceased.  Bankruptcies  increased 
in  1819  more  than  50  per  cent,  over  the  number  of  the  previous  year. 
Meetings  were  held  throughout  England  in  which  the  people  called 
on  the  government  to  devise  some  means  of  redressing  the  situation 
So  universal  was  the  distress  that  the  owners  of  laud  in  England, 
who  in  1819  numbered  160,000  were  in  seven  years,  by  forced  s  ties 
and  foreclosure  of  mortgages  on  the  smaller  farms,  reduced  to  30,000, 
and  one  in  every  seven  of  the  population  lived  on  organized  charity. 
All  this  was  but  a  part  of  the  price  which  the  people  of  England  paid 
for  a  policy  imposed  on  them  by  the  creditor  classes  among  their  own 
unmber.  The  condition  of  industry  and  disorganization  of  labor  led 
to  frequent  and  serious  conflicts  between  the  people  and  the  mili- 
tary. They  also  led  to  commercial  crises  without  number,  and  Eng- 
land, by  demonetizing  silver  and  thus  ceasing  to  be  "alongside" 
India,  became  the  seat  of  panics,  as  Egypt  had  long  been  of  the 
plague  and  India  of  the  cholera. 

As  a  contrast  to  this  I  will  merely  cite  the  change  in  the  condition 
of  India  within  the  past  seventeen  years.  When  the  Western  world 
discarded  silver  as  money  and,  as  a  consequence,  India  received  a 
larger  supply  of  it  than  ever  before,  that  barbarous  nation,  as  is  uni- 
versally admitted,  made  progress  by  leaps  and  bounds.  No  country 
on  earth  has  in  the  same  time  made  such  advances  in  material  pros- 
perity and  in  all  the  elements  that  conduce  to  the  comfort  and  hap- 
piness of  a  people.  Notwithstanding  the  alleged  debasement  of 
silver,  no  sooner  had  its  increased  inflow  into  India  begun  than  the 
industries  of  a  vast  continent  were  established  and  set  in  motion, 
and  a  substantial  part  of  the  activity  and  prosperity  that  were  wont 
to  pervade  some  of  the  industries  of  the  United  States  has,  by  that 
JONES 3 


34 

demonetization,  been  transferred  to  fields  of  wheat,  and  fields  and 
factories  of  cotton  10,000  miles  distant. 

\Vh:it  really  placed  as  alongside  such  barbarous  countries  as  India 
was  the  demonetization  of  silver.  It  was  by  that  demonetization 
that  the  people  of  Europe  were  enabled,  with  gold,  to  buy  silver  at 
'Jo  per  trni.  discount,  which,  when  shipped  to  India  and  coined  into 
rupees,  would  buy  as  much  wheat  as  could  ever  have  been  bought 
with  that  coin.  There  has  been  no  decrease  whatever  in  the  pur- 
chasing power  of  the  rupee  in  India.  This  was  equivalent  to  buy- 
ing wheat  at  30  per  cent,  below  the  price  theretofore  paid  for  it,  and 
thin  the  farmers  of  the  United  States  were  by  demonetization  placed 
"alongside"  the  barbarous  people  of  India.  Their  wheat  had  to 
compete  in  the  European  markets  with  the  wheat  of  India,  and  it 
ompetition  that  placed  them  "alongside "  India.  The  farmer 
of  this  country,  then-fore,  by  demonetization  of  silver,  was  compelled 
i>ete  with  under-paid  and  half  starved  ryots.  And  so  it  was 
that  our  cotton  planters,  by  the  demonetisation  of  silver,  were 
placed  alongside  the  barbaro'us  people  of  India.  It  is  this  degrading 
competition  that  places  a  highly  civilized  people  alongside  a  barbar- 
ous one. 

The  advocates  of  the  single  gold  stand  ml  deem  even  silver  money 
much  better  money  than  greenbacks.  Does  it  then  follow  that  when 
greenbacks  were  our  only  money — good  enough  money  to  c;ury  the 
nation  through  the  greatest  war  in  all  history — we  were  "along- 
side" or  underneath  the  barbarous  nations  of  the  world  T  It  is  not  the 
form,  or  the  material  of  a  nation's  money  that  fixesitsstatns  relatively 
to  other  nations.  That  is  accomplished  by  the  vitality,  the  energy, 
the  intellectuality  and  effective  force  of  its  people.  The  United 
States  can  never  be  placed  "  alongside  "  any  barbarous  nation,  ex- 
cept by  compelling  our  people  to  com  pete  with  barbarous  peoples — 
compelling  them  to  sell  the  products  of  American  labor  at  prices  reg- 
ulated by  the  cost  of  labor  and  manner  of  living  in  barbarous  conn- 
trie*.  An  well  might  it  be  s  id  that  we  are  alongside  the  barbarous 
people  of  India  because  we  continue  to  produce  wheat  and  cotton. 

The  distinguishing  feature  of  all  barbarous  nations  is  the  squalor 
of  their  working  classes.  The  reward  of  their  hard  toil  is  barely 
enough  to  maintain  animal  existence.  A  civilized  people  are  plact -d 
alongside  a  barbarous  one  when,  in  their  means  of  livelihood,  the 
foundation  of  their  civilization,  they  *re  made  to  compete  with  the 
barbarians.  That  was  the  result  accomplished  for  the  farmers  and 
planters  of  the  United  States  when  silver  was  demonetized. 

CKKPITOHB  AXI)   DE1ITOIIA.— A   COMPARISON  OF  MOTIVE*. 

All  movements  for  the  increase  of  the  monetary  <  n  dilation  are 
ascribed  by  the  money-lender*  and  creditor  elates  to  the  unworthy 
desire  on  the  part  of  the  debtors  to  escape  their  just  obligations. 
But  if  motives  are  to  be  brought  in  question,  tin-  rule  should  work 

note  is  taken  of  the  motive  ,,f  the  creditor  <  lasses  In 
securing  a  contraction  of  the  circulation.  Whatever  the  nppar.  nt 
purpose  of  contrail  ion,  and  1.  i  the  arguments  ad- 

vanced MI  •:.  teal  object  has  always  be«-n  to  i: 

the  purchasing  ;,  In  all  count  i ,,  -.  ami  throughout  all 

npid.tv   oi   the  creditor  classes  and   annnitair 
•  crease  the  value  of  the  in.. ne\  unit  that  has  brought 
about  a  shrinkage  in  the  moi.ey  volume.     Cnlike  the  great  masses  of 
the  people,  who  were  ignorant  of  the  effects  to  be  natum 
from  such  a  shrinkage,  the  annuitants  and  moneyed  men  v.  ; 
understood  that  the  value  of  every  pound  or  dollar  depended  on  tin- 


35 

* 

number  of  pounds  or  dollars  that  were  in  circulation ;  the  larger 
the  total  number  out,  the  smaller  the  purchasing  power  of  each  ;  the 
smaller  the  total  number  out,  the  greater  the  purchasing  power  of 
each. 

Loaners  of  capital  are  not  usually  those  who  entertain  further  hope 
of  personal  achievement.  When  it: en  realize  fortunes  it  is  rarely  that 
they  conserve  the  faculty  of  initiative;  they  find  no  special  delight 
in  novelty ;  they  look  so  carefully  to  security  in  the  use  of  money  that 
the  spirit  of  adventnre  is  restrained.  The  realization  of  a  fortune  \s 
usually  the  labor  of  a  life- time,  and  few  men  who  reach  the  goal  care 
to  retrace  their  steps  to  enter  again  upon  a  struggle  that  demands  all 
the  strength,  the  momentum,  and  the  intrepidity  of  youth.  Men  of 
assured  incomes  therefore  are  disposed  to  take  their  e,ase,  and  society 
must  look,  for  its  material  progress  and  development,  to  those  %vho 
have  a  career  to  make,  with  the  ambition  and  the  power  to  make  it. 

It  is  a  remarkable  circumstance,  Mr.  President,  that  throughout  the 
•entire  range  of  economic  discussion  in  gold-standard  circles,  it  seems 
to  be  taken  for  granted  that  a  change  in  the  value  of  the  money 
unit  is  a  matter  of  no  significance,  and  imports  no  mischief  to  so- 
ciety, so  long  as  the  change  is  in  one  direction.  Who  has  ever 
heard  from  an  Eastern  journal  any  complaint  against  a  contraction 
of  our  money  volume;  any  admonition  that  in  a  shrinking  volume 
of  money  lurk  evils  of  the  utmost  magnitude?  On  the  other  hand 
we  have  been  treated  to  lengthy  homilies  on  the  evils  of  "  inflation," 
whenever  the  slightest  prospect  presented  itself  of  a  decrease  in  the 
value  of  money — not  with  the  view  of  giving  the  debtor  an  ad- 
vantage over  the  lender  of  money,  but  of  preventing  the  uncon- 
scionable injustice  of  a  further  increasing  value  in  the  dollars 
which  the  debtor  contracted  to  pay.  Loud  and  resounding  pro- 
tests have  been  entered  against  the  "  dishonesty  "  of  making  pay- 
ments in  "  depreciated  dollars."  The  debtors  are  characterized  as 
dishonest  for  desiring  to  keep  money  at  a  steady  and  unwavering 
value.  If  that  object  conld  be  secured,  it  would  undoubtedly  be 
to  the  interest  of  the  debtor,  and  could  not  possibly  work  any  in- 
justice to  the  creditor.  It  would  simply  assure  to  both  debtor  and 
creditor  the  exact  measure  for  which  they  bargained.  It  would  en- 
able the  debtor  to  pay  his  debt  with  exactly  the  amount  of  sacrifice 
to  which,  on  the  mak'ing  of  the  debt,  he  undertook  to  submit,  in. 
order  to  pay  it. 

WHO  ABE  THE  DEBTORS? 

In  all  discussions  of  the  subject  the  creditors  attempt  to  brush  aside 
the  equities  involved  by  sneering  at  the  debtors.  But,  Mr.  President, 
debt  is  the  distinguishing  characteristic  of  modern  society.  It  is 
through  debt  that  the  marvelous  developments  of  nineteenth  cen- 
tury civilization  have  been  effected.  Who  are  the  debtors  in  this 
country  ?  Who  are  the  borrowers  of  money  ?  The  men  of  enterprise, 
of  energy,  of  skill,  the  men  of  industry,  of  foresight,  of  calcula- 
tion, of  daring.  In  the  ranks  of  the  debtors  will  be  found  a  large 
preponderance  of  the  constructive  energy  of  every  country.  The 
debtors  are  the  upbuilders  of  the  national  wealth  and  prosperity; 
they  are  the  men  of  initiative,  the  men  who  conceive  plans  and  set 
on  foot  enterprises.  They  are  those  who  by  borrowing  money  enrich 
the  community.  They  are  the  dynamic  force  among  the  people. 
They  are  the  busy,  restless,  moving  throng  whom  you  find  in  all 
walks  of  life  in  this  country — the  active,  the  vigorous,  the  strong, 
the  undaunted. 

These  men  are  sustained  in  their  efforts  by  the  hope  and  belief  that 
their  labors  will  be  crowned  with  success.  Destroy  that  hope  and 


30 

yon  take  away  from  society  the  most  powerful  of  all  the  i: 

material  development  ;  yon  place  in  the  pathway  of  progress  an  ob- 

\vhich  it  is  impossible  to  surmount. 

The  men  of  whom  I  have  spoken  arc  undoubtedly  the  first  who  are 
likely  f»  be  atl'ected  by  a  *hr,;iKage  in  the  volume  id"  money. 

The  highest   prosperity  of  a   nation   is  attained  only  when   all  its 
people  are  employed   in   avocations  suited  to  their  individual  apti- 
and  when  a  just  money  system  insures  an  equitable  distribu- 
'.    the  product*  of  their  industry.     With  our  mplex 

civilization,  in  order  that  men  may  have  constant  emplo\  ment,  it  is 
•  usable    that    work    be    planned    and    undertakings   pi. 
;n  advance.     Without   an   intelligent    forecast    01  enterprises 
•  t"  workmen    nr  .illy  be  relegated    to    idle- 

Dntcrprises  that  take  years  to  complete  must  becont: 
for  in  advance,  and  payments  provided  for. 

A  constant  but  unperccived  rise  in   the  value  of  the  dollar  with 
which  those  payments  must   be  made,  bailie-*  all    plans,  thwa 
calculation,  and  destroys  all  e<:  .ecu   debtor  a: 

If  we  can    not    intelligently  regulate,   our   money    voln:i.. 
maintain   unchanging  the  value  of  the   money  unit,  if  we   can  not 

:-om  the   hlighti-  \vhich  an   incr. 

the  measiirii.g  power  of  the  money  unit  entails  upon  all  imln- 
what  purpose  is  our  boaste  I  civilization  t 

]'.y   the    increase  of   that    measuring   power   all    i  !i«*ap- 

d,  all   purposes  batiled.  ail   etlbrts  thwarted,   all    calculations 
]  '.'die  enlargement    in   the    measuring    power  of    the 

unit   of  money  ithe  dollar)  ath 
munity.      Like  a  poisonous  drug  in   the  human   body.  : 

i;ber  and    filament  of  the   ind 

structure.     The  debtor  is  lighting  for  h:  -  -isf  an  enemy  he 

.aiiist    an    inlln.-nee   In-   >'.<•  anil.      For. 

while  his    calculations  were   \\ell  and   intelligently   made,   and   the 
amount  of  -:;s  of  hi*  con!  racts  remain  th- 

the  weight  of  all  his  obligations  has  been  increased  by  an  insidious 
increase  in  the  \alm-  of  the  money  unit. 

EFFECTS  OF  A  SHKINKIM!   VOLUMK  OF  MOXKT. 

benumb:  ,  following  a  shrinkage  in  the 

volume  of  money.  I  In-  testimony  of  history  is  l.riell  \  in  the 

of  t  lie  Mi «in  tai  \  ( 'on i m is, ion  to  which  1  has  e  alrea.. 
and  from  which  I  read  the  fidlowii 

Ml    in 

'   ami  ftvedon  all  ilmappMiriMl.    Tne  pooplft  were  reduced  i 


M- 

Kni|itrn 

- 

•K«   in    '  »-u  lUno  w 


37 

ure  from  the  New  World  were  needed  to  arouse  the  Old  World  from  its  comatose 
sleep,  to  quickeu  the  torpid  limbs  of  industry,  and  to  plume  the  leaden  wings  of 
commerce.  It  needed  the  heroic  treatment  of  rising  prices  to  enable  society  to 
reunite  its  shattered  link.*,  to  shake  off  the  shackles  of  feudalism,  to  relight  and 
uplift  the  almost  extinguished  torch  of  civilization.  That  the  disasters  of  the 
Dark  Ages  were  caused  by  decreasing  money  and  falling  prices,  and  that  the  re- 
covery therefrom  and  the  comparative  prosperity  which  followed  the  discovery 
of  America  were  due  to  an  increasing  supply  of  the  precious  metals  and  rising 
prices,  will  not  seem  surprising  or  unreasonable  when  the  noble  functions  of 
money  are  considered.  Money  is  the  great  instrument  of  association,  the  very 
fiber  of  social  organism,  the  vitalizing  force  of  industry,  the  protoplasm  of  civiliza- 
tion, and  as  essential  to  its  existence  as  oxygen  is  to  animal  life.  Without  money 
civilization  could  not  have  had  a  beginning  ;  with  a  diminishing  supply  it  must 
languish,  and,  unless  relieved,  finally  perish. 

Symptoms  of  disasters  similar  to  those  which  befell  society  during  the  Dark 
Ages  were  observable  on  every  hand  during  the  first  half  of  this  century.  In  1809 
the  revolutionary  troubles  between  Spain  and  her  American  colonies  'broke  put 
These  troubles  resulted  in  a  great  diminution  in  the  production  of  the  precious 
metals,  which  was  quickly  indicated  by  a  fall  in  general  prices.  As  already  stated 
in  this  report,  it  is  estimated  that  the  purchasing  power  of  the  precious  metals  in- 
creased between  1809  and  1848  fully  145  per  cent.,  or,  in  other  words,  that  the  gen- 
eral range  of  prices  was  60  per  cent,  lower  in  1848  than  it  was  in  1809.  During  this 
period  there  was  no  general  demonetization  of  either  metal  and  no  important  fluc- 
tuation in  the  relative  value  of  the  metals,  and  the  supply  was  sufficient  to  keep 
their  stock  good  against  losses  by  accident  and  abrasion.  But  it  was  insufficient 
to  keep  the  stock  up  to  the  proper  correspondence  with  the  increasing  demand  of 
advancing  populations. 

The  world  has  rarely  passed  through  a  more  gloomy  period  than  this  one.  Again 
do  we  find  falling  puces  and  misery  and  destitution  inseparable  companions.  The 
poverty  and  distressof  the  industrial  masses  were  intense  and  universal,  and,  since 
the  discovery  of  the  mines  of  America,  without  a  parallel.  In  England  the  suffer- 
ing of  the  people  found  expression  in  demands  upon  Parliament  for  relief,  in 
bread-riot*,  ami  in  immense  Chartist  demonstrations.  The  military  arm  of  the 
nation  had  to  be  strengthened  to  prevent  the  all-pervading  discontent  from  ripen- 
ing into  open  revolt.  On  the  Continent  the  fires  of  revolution  smoldered  every- 
where, and  blazed  out  at  many  points,  threatening  the  overthrow  of  states  and 
the  subversion  of  social  institutions. 

Whenever  and  wherever  the  mutterings  of  discontent  were  hushed  by  the  fear 
of  increased  standing  armies,  the  foundations  ot  society  were  honey-combed  by 
powerful  secret  political  associations.  The  cause  at  work  to  produce  this  state 
of  things  was  so  subtile,  and  its  advance  so  silent,  that  the  masses  were  entirely 
ignorant  of  its  nature.  They  had  come  to  regard  money  as  an  institution  fixed 
and  immovable  in  value,  and  when  the  price  of  property  and  the  wages  of  labor 
fell,  they  charged  the  fault,  not  to  the  money,  but  to  the  property  and  the  em- 
ployer. They  were  taught  that  the  mischief  was  the  result  of  overproduction. 
Never  having  observed  that  overproduction  was  complained  of  only  when  the 
money  stock  was  decreasing,  their  prejudices  were  aroused  against  labor-saving 
machinery.  They  were  angered  at  capital,  because  it  either  declined  altogether 
to  embark  in  industrial  enterprises  or  would  only  embark  in  them  upon  the  con- 
dition of  employing  labor  at  the  most  scanty  remuneration.  They  forgot  that 
falling  prices  compelled  capital  to  avoid  such  enterprises  on  any  other  condition, 
and  for  the  most  part  to  avoid  them  entirely.  Thev  did  not  comprehend  that 
money  in  shrinking  volume  was  the  prolific  parent  of" enforced  idleness  and  pov- 
erty, and  that  falling  prices  divorced  money-capital,  from  labor,  but  they  none  the 
less  felt  the  paralyzing  pressure  of  the  shrinking  metallic  shroud  that  was  closing 
around  industry. 

The  increased  yield  of  the  Russian  gold  fields  in  1846  gave  some  relief  and  served 
as  a  parachute  to  the  fall  in  prices,  which  might  otherwise  have  resulted  in  a  great 
catastrophe.  But  the  enormous  metallic  supplies  of  California  and  Australia 
were  all  needed  to  give  substantial  and  adequate  relief.  Great  as  these  supplies 
were,  their  influence  in  raising  prices  was  moderate  and  soon  entirely  arrested  by 
the  increasing  populations  and  commerce  which  followed  them.  In  the  twenty- 
five  years  between  1850  and  1876  the  money  stock  of  the  world  was  more  than 
doubled,  and  yet  at  no  time  during  this  period  was  the  general  level  of  prices 
raised  more  than  18  per  cent,  above  the  general  level  in  1848. 

A  comparison  of  this  effect  of  an  increasing  volume  of  money  after  1848  with 
the  effect  of  a  decreasing  volume  between  1809  and  1848  strikingly  illustrates  how 
largely  different  in  degree  is  the  influence  upon  prices  of  an  increasing  or  decreas- 
ing volume  of  money.  The  decrease  of  the  yield  of  the  mines  since  about  1865, 
while  population  and  commerce  have  been  advancing,  has  already  produced  unmis- 
takable symptoms  of  the  same  general  distrust,  non-employment  of  labor,  and 
political  and  social  disquiet,  which  have  characterized  all  former  periods  of  shrink- 
ing money. 
JONES 


38 


The  time  that  has  elapsed  since  that  report  was  written  has  but 
•erved  to  verify  ami  emphasize  its  statements. 

THE    FALL  OF  1'HICEfi  B1XCK   1873. 

It  is  a  fact  not  ilisputi'tl  anywhere  but  nni\  e:-.i!ly  admitted,  that 
for  many  years  past  the  jiriee.s  of  all  artiele-,  entering  into  general 
fonsiiiiiption  union;;  the  pt»opl«-  liuvo  IU>«M>  steadily  falling.  It  is 
obvious  that  the  industrial  conditions  pn-\  ailing  Miiee  l-?;i  ate  Init 
a  repetition  of  thoce  above  described  a«  following  l>u9 — \\ith  fall- 
inn  prift'«,  coiiKtunt  nmvM.  and  universal  discontent. 

!ollo\vin<r    table,  compiled  from  figures  i»ul»lishe«l  by  the  I'.u- 
rean  of  Statistics  of  the   Tlea-ur.v.    Department,  shows   (lie   ;: 

range  of  export  prices  of  the  articles  named  for  each  year 

Annual  average  export  pricet  of  commvditiei  of  domestic  production  for 
each  year  from  Iti73  to  1--1),  in< /» - 


Tear  end  Ing 
June,  30- 

Corn 
li«r 

bualu-1. 

vrh«*t 

p«r 

bushel. 

Wheat 
flour 
per 
barrel. 

Cotton 
(up- 
land) 
,,,-r 
pound. 

Leather 

IKT 

JMIUllJ. 

Illnrai- 
iiatluc 
oil«, 

]••  "n-'.l  . 

pUtOB. 

P..O-.  ;i 
and 
hams 

JM-l 

pound. 

Lard 
per 

jxiuiid. 

1873  

Hollar,. 
618 

Dollar* 
1  31'.! 

DoUart 
7  565 

.  CenU 
18.8 

CenU. 
25.3 

CenU. 
23  5 

OtnU. 

8.8 

CenU. 

.719 

1.428 

7.144 

15  4 

25.2 

17.3 

9.6 

9  4 



.848 

1   1J4 

'.  •.».- 

15  0 

26.0 

14.1 

11.4 

13.  9 

.67:2 

6.  216 

12.9 

14.0 

12.1 

13.3 

587 

1  169 

C.  4tW 

11  8 

23  9 

21  1 

10  9 

10  9 

1878  

.5ft! 

1  338 

6.358 

11  1 

21.8 

14.4 

8.7 

8  8 

1879  . 

.471 

;  (>-.- 

-   ..  ., 

9  9 

20.4 

10.8 

6.9 

7.0 

.543 

1.245 

11.5 

23.3 

8.6 

6.7 

7  4 

.552 

1   114 

"  Hi 

11  4 

22  6 

10  3 

v  | 

9  3 

,  i> 

6.  149 

11  4 

20  9 

9.1 

9.9 

11  6 

lp8a.... 
1884  

.684 
.611 

1.U06 

5.955 
:,  IH 

lu.6 
10.5 

11.1 

20.6 

8.8 

11.  -J 
in  L1 

11.9 
9.5 

.540 

882 

4  897 

10  6 

19  8 

8.7 

0  2 

7  9 

.498 

.870 

4  699 

9  9 

19  9 

8.7 

6  9 

1887  

.479 

.890 

4  510 

9  6 

7  8 

7.9 

7.1 

.560 

n 

4.679 

9.8 

7.9 

K  0 

7  7 

18e9. 

.474 

.897 

4.  KG 

9  9 

16.6 

7  8 

8  6 

8.6 

Y«*r  rndlng 
June  30— 

Pork. 
nalf-,1. 
•'   ' 

;•••  ::  t 

Hull,  r 
IKT 

'!•  .  i  ii. 

Starch 

,.,r 

JlOtlllll. 

Sugar. 

Toliac- 
ro.  li-af, 

CfnU. 
82 
10  6 

7.  7 
8.2 
8.7 

Omu. 
2-X9 

Ota* 

18.6 
12  6 

<  :  7,  •> 
26.6 

2.V6 
28,0 

OtnU 
6.0 

/  .  •," 
11.6 

10  7 

/    1  ', 

96 

11.8 
10  4 

9.0 

7  5 

11  8 

S.V9 

| 

ll  n 

6.8 

4  7 

4.7 

6.3 

8  II 

4  2 

7  8 

6  1 

0.4 

17    1 

9  6 

; 

4  3 

0.5 

19.8 

4  7 

K.8 

9  0 

8.5 

19  S 

4   X 

8  5 

9.  9 

K.9 

18.6 

11  "i 

2u  9 

4.6 

8  6 

".It 

7.6 

21.2 

4  f, 

7  j 

7.2 

21  6 

4.  0 

0  4 

9  9 

., 

6.9 

6.0 

15.6 

8  :i 

4  ] 

6  7 

7  8 

: 

6.6 

7  ( 

5.5 

l.VK 

16.6 

».> 

9.9 
9.S 

It.  9 
13.9 

3.8 
3.6 
3  8 

6.0 
6.  8 
7  6 

8.7 
83 
8-8> 

39 


To  show  from  another  source  the  same  general  fact  of  the  decline 
of  prices,  I  quote  from  an  article  published  in  the  New  York  Tri- 
bune early  in  1886. 

The  New  York  Tribune  is  pretty  good  authority.  These  figures 
are  undoubtedly  from  the  calculations  and  from  the  pen  of  Mr. 
Grosvenor,  of  the  editorial  staff  of  that  able  journal,  formerly  editor 
and  proprietor  of  the  "Public,"  whose  estimates  of  prices  have,  iu  my 
judgment,  been  more  correctly  made  than  those  of  any  other  statis- 
tician in  the  world.  The  article  is  as  follows: 

Quotations  of  about  two  hundred  articles  are  compared  since  1860,  and  the 
amount  of  money  is  ascertained  which  would  purchase,  at  different  dates,  of  these 
various  articles,  quantities  sorreeponding  as  closely  as  possible  to  their  ascer- 


tained consumption  in  1880,  the  date  of  the  last  census.  Amo«g  the  articles  com- 
pared are  wheat,  corn,  oats,  rye,  barley,  beans  and  pease,  tuesspWk,  bacon,  ham,  live 
hogs,  lard,  fresh  beef,  tallow,  live  sheep,  poultry,  butter,  cheese,  eggs,  milk,  hay, 


Eotatoes,  turnips,  cabbage,  onions,  apples,  raisins,  sugar,  brown  and  crushed  ;  mo- 
isses,  coffee,  tea,  tobacco,  whisky,  malt  and  hops,  mackerel,  codfish,  salt,  rice, 
nutmegs,  cloves,  pepper,  cotton,  print-cloths  and  standard  sheeting,  wool  of  differ- 
ent qualities,  blankets,  carpets,  n  nnels,  leather,  boots,  shoes,  hides,  silk,  India  rub- 
ber, iron  (pig  and  bar),  nails,  steel  rails,  coal,  oil  (crude  and  refined),  tin  and  tin 
plates,  copper,  lead,  hemp,  lumber,  spruce  and  pine,  oak,  ash,  walnut,  and  white 
wood,  lath,  brick,  lime,  turpentine,  linseed  oil,  so  ip,  glass,  paper,  white  lead,  and 
twelve  other  kinds  of  paints,  fertilizers,  and  over  fifty  kinds  of  drugs  and  chemi- 
cals. 

*  *  *  *  *  *  * 

Cost  of  products  at  different  dates. 


Dates. 

Cost  in 
currency. 

Price  of 
gold. 

Cost  in 
gold. 

1860,  May  1  

$100.  00 

$100.  00 

$100.  00 

1865  November  1  

174.  77 

145.  87 

119.81 

1866  May  1  

157.60 

125.12 

126.  04 

1866  November  1   

170.31 

146.  25 

117.  82 

1871,  November  1    

122.  03 

112.  00 

108.  95 

1872,  May  1  

137.  13 

112.50 

121.81 

1873  November  1                      

115.14 

108  50 

106.  01 

1874,  Mayl    

122.77 

112.  87 

108.  77 

1875,  January  1  ...  

113.01 

1  L2.  37 

100.  37 

1876,  October  1  

97.30 

110.  00 

88.45 

1877  May  1  

99.29 

106.  75 

93.01 

1878  May  1  

82.09 

100.  37 

81.81 

1878,  October  18  

77.  94 

100.  37 

77.65 

1879  November  1                                                

93.48 

1880  January  1               .            .              .            

103.42 

95  98 

188°'  May  16' 

100  59 

1883  March  13 

97  8° 

188  !,  November  1         ..          

88.71 

1884   January  1          .       

88.37 

1884  November  21                                                 

78  47 

1885,  January  1  
1885,  Mav  9  

79.66 
80  22 





1885  Au"ust,  y> 

74  56 

1885   November  1                                           

75  35 

18d5,Close"                                              

78.53 

It  is  not  only  clear  from  this  comparison  that  the  pi-ices  of  1885  have  been  the 
lowest  in  our  history  for  twenty-five  years,  but  that  there  has  been  a  general  ten- 
dency toward  lower  prices.  From  1866  to  1871,  and  again  from  1872  until  1885  prices 
fell  quite  steadily.  Indeed,  had  not  the  short  crop  of  188t  caused  a  temporal",  ad- 
vance in  the  spring  of  188-,  the  ran<ie  of  January,  18^0,  would  have  been  the  high- 
est of  the  later  period,  and  it  might  have  been  said  that  the  present  era  of  declin- 
ing prices  had  continued  with  little  intermission  for  six  years.  None  will  fail  to 
observe  how  swift  and  sharp  the  advances  have  been— about  12  per  cent,  from 
Novf"»l>f>v,  1871,  to  May,  1872,  aud25£  percent,  from  October,  1878,  to  January,  1880. 


40 

But  the»e  •paamodic  advance*,  by  which  the  general  tendency  downward  in  inter- 
rupted, only  terre  to  make  it  nior~eclr.it  that  |tiu-e*  have  been  tending  irresistibly 
toward  a  lower  level  than  that  of  I860,  not  onlv  during  the  period  of  paper  depre- 
ciation, but  ainc«  gold  baa  been  the  moaaure  of  value. 

In  order  to  show  that  the  United  States  are  not  alone  in  their  com- 
plaint of  falling  prices,  but  that  tin-  complaint  is  universal,  and  in 
order  that  we  may  have  before  us  a  broad  view  of  the  lioUl  of  general 
prices,  I  submit  a  table  showing  the  relation  to  each  other  ot  the 
range  of  prices  from  1809  to  1849,  by  decades,  baaed  on  tin-  prices  of 
lifty  leading  articles  of  commerce,  prepared  by  the  distinguished 
-sor  Jerons  and  published  in  the  London 'Econom  ist  for  Muv 
8,  !>• 

Taking  the  raflfee  of  prices  of  1849  as  a  datum  line  (the  range  for 
that  year  being  the  lowest  of  the  century)  Mr.  Jevons  works  back- 
ward to  1HC.I,  when  tin-  revolt  «>t  tin-  South  American  colonies  against 
the  aiitlioiity  of  Spain  shut  off  at  a  blow  tin-  supplies  of  the  pi 
metals,  and  set  on  toot  a  money  famiu«  from  which  the  world  knew 
no  relief  till  the  discovery  of  the  mines  of  California  and  Australia. 

l'r«.i,  s>,,r  Jevons's  figures  are  as  follows,  the  prices  of  Ib49  being 
represented  I -y  100: 

Relation  ofpricet,  1809  to  1849,  b<i  decadet,  those  for  Id  IK  btinfl  rn',<l  at 

100. 

1809 245 

1819...  17". 

182» 

1839 14* 

1M9 iw 

these  figures  it  will  be  observed  that  the  fall  from  1809  to  1849, 

•  .I  of  forty  years,  was  as  245  to  101),  or  "»'.»  per  cent. 

Hy  tin-  next  table  which  I  submit,  thatof  Dr.  Soetbeer.  it  will  be 

•  iiat  the  general  range  of  prices  rose  gradually  from   l-t'.i  t<> 

•  •f  which  yean*  the  figures  bore  to  tin--,,  ot  l-i;i  the 

101).     It  has  never  been  denied  that  this  rise  was  due 

to  tin-  increase  in  the  world's  money  supply  by  the  yield  of  the  pre- 

uietalsfrom  the  mines  of  Californiaaiid  Australia,  the  ctibcts  of 

wliich,  however, as  will  be  seen  by  the  table,  were  not  felt  on  prices 

till  1853 — live  yearn  after  John  Marshall's  discovery   of  the  yellow 

metal  in  the  tnil-rac^at  Suiter's  mills.    Yet,  because  it  interfere*  with 

the  pecuniary  interests  of  a  large  and  influential  class,  it   is  vehe- 

.  denied  that  the  fall  of  prices  since  187:1  is  duo  to  a  decrease  in 

the  volume  of  the  money  caused  by  the  demonetization  of  silver  in 

that  year  throughout  the  western  world. 

'  and  after  that  year,  aa  will  In-  perceived  by  an  examination  of 
the  figure*;  in  other  words,  from  the  year  when  one-half  the  world's 
;>!y  wan  deprived  of  the  immcy  function,  we  find  an  almost 
•i  mptod  decline  of  prices.    The  figures  of  1873  and  1885  will  be 
•een  to  boar  to  one  another  the  relation  of  l:H  to  in-.  or  a  fall  of  -"J 
percent,  in  twelve  yean.    Should  the  fall  continue  at  that  rate  with- 
«"'t  !'•'•  and  there  is  no  reason  apparent  why  it  should  not, 

wesUall  in  forty  years  hare  witnessed  a  decline  of'T;>  per  cent,  in 
••  of  prices— a  decline  considerably  greater  t  ban  t  hat 
Irom  l-<c.t  to  l-J'.i.      And  these  .,re  not  the   li^iir-'s  of  hinictallists  or 
•ilv«r  i."  but  of  pronounced  advocated  of  the  single  stand- 

ard of  gold.     Where,  I  would  inquire,  is  the  fall  ot  ,.pf 

Dr.  Soetbeer's  table  represents  the  general  average  price  of  one- 

lorceeach  year  for  at>enod  of  nearly 
forty  years.    He  takes  as  a  basis  the  general  range  of  gold  prices  pro- 


41 

vailing  between  1847  and  1850,  and  calling  that  range  100,  shows  the 
relative  standing  toward  it  of  the  general  range  of  prices  for  subse- 
quent years,  up  to  1885. 

Relation  of  prices  by  years  from  1849  to   1885,  the  general  range  of 
prices  of  1849  being  rated  at  100. 


1849  

100.00  ! 

1869  

123  38 

1&51    

100.21  j 

1870 

122  87 

1852  

101.69i 

1871 

127  03 

1853 

113  69 

1872 

135  62 

1854 

.   121.25 

lfr-55   

l->4  23 

1873  . 

138  28 

1856  

123.27 

1857  

130.11 

1874  

136  20 

1858 

113  52 

1875 

1''9  85 

1859  

116.34 

1876  

128.33 

I860  

r_'t>.  »* 

1877  . 

1<>7  70 

1861  

11^.10 

1878  

VO  60 

1862  

122.65 

1879  

117.10 

1863  

12.").  49 

1SSO 

.     I'Ji  89 

1864  

129.28 

1881  

1?1  07 

1865  

122.6.1 

1882  

!•->'>.  14 

1866  

125.85 

1883  

122.24 

1867  

]24  44 

1884 

.      114  ->5 

1868... 

.  121.99 

1885... 

.  108.  27 

Mr.  Sauerbeck,  also  an  advocate  of  the  gold  standard,  and  whose 
work  has  the  approval  of  the  Statistical  Society,  takes  as  a  datum 
line  the  prices  ruling  from  1867  to  1870.  Rating  those  at  100  he 
finds  that  by  1873  prices  had  risen  to  111,  by  1886  they  had  fallen  to 
69,  and  by  September,  1887,  to  68.7.  He  declares  the  average  prices 
for  the  first  nine  months  of  1887  to  have  been  the  lowest  reached  for 
a  hundred  years. 

BOTH  GOLD  AND  SILVER  VAKIABLK  D?  VALUE. 

The  fact  that  the  inetals  have  separated  considerably  since  1873, 
and  that  silver  bullion  now  sells  at  less  than  par  value  of  $1.29  per 
ounce,  is  taken  to  signify  that  silver  has  fallen — not  that  gold  has 
risen.  This  proceeds  from  the  assumption  that  whenever  a  change 
takes  place  in  the  relation  between  gold  and  any  other  article  the 
change  must  necessarily  be  in  the  other  article.  This  assumption, 
in  turn,  is  based  on  the  absurd  idea  that  calling  gold  a  "  standard  " 
will  insure  it  against  change. 

Among  political  economists  it  is  a  well-recognized  principle  that 
neither  gold  or  silver  is  exempt  from  the  universal  application  of 
the  law  of  supply  and  demand.  That  law  governs  gold  and  silver, 
not  only  as  commodities,  but  as  money,  and  governs  as  well  all 
other  kinds  of  money  that  may  be  used.  And  while  the  advocate  of 
the  single  gold  standard  is  at  all  times  ready  to  concede  the  truth  of 
this  assertion  as  to  silver,  he  is  confident  that  it  does  not  and  can 
not  apply  to  gold;  that  the  economic  law  which  makes  supply  and 
demand  a  regulator  of  value  is  suspended  as  to  gold. 

That  a  metallic  money,  whether  of  gold  or  silver,  is  very  far  from 
being  stable  is  admitted  by  innumerable  authorities,  of  whom  I  will 
cite  only  a  few. 

Dr.  Adam  Smith,  in  his  "Wealth  of  Nations,"  book  1,  chapter  5, 
says: 

Gold  and  silver,  like  every  other  commodity,  vary  in  their  value.  The  discov- 
ery of  the  abundant  mines  of  America  reduced  in  the  sixteenth  century  the 
value  of  eold  and  silver  in  Europe  to  about  a  third  of  what  it  had  been  before. 
This  revolution  in  their  value,  though  perhaps  the  greatest,  is  by  no  means  the 
only  one  of  which  history  gives  some  account. 
JONES 


42 

And  again  : 

Increase  th«  scarcity  of  c°'J  to  »  certain  degree  and  the  smallest  bit  of  it  may 
be  more  precious  than  a  diamond. 

John  Locke,  "Considerations,    etc.,  in  relation  to  money"  (pub- 
lished in  1691),  says: 

The  greater  ACArcitv  of  money  enhances  its  price  and  increases  ' 
then  being  nothing  that  does  supply  the  want  of  it ;  t!  •  ..intity, 

s  its  price  and  make*  an  equal  portion  of  it  exchange 
for  a  greater  of  any  other  thiiu'- 

Prof.  Francis  A.  Walker,  "  Money,"  etc.,  page  210,  says : 

Gold  and  silv«r  do,  over  1  >nz  periods,  undergo  great  change*  of  value  and  be- 
come in  a  high  degree  deceptive  M  a  measure  of  the  obligation  of  the  debtor  of 
•i  of  the  rr.-ditor.      Tim*  I'rot' twor  Jevons  estimate*  th.it    tin-  value  of 
between  1788  an  I  ISO  i,  40  per  rent.,  that  from  1S09  to  1819  it  ruse  145  per 
cent,  while  in  twenty  yearn  alter  1MO  it  Ml  again  at  leaat  20  per  cent. 

Jevons,  "Money  and  Exchange,"  chapter  6,  says: 

In  respect  to  steadiness  ef  value  the  metal*  are  probably  leas  satUfactory,  re- 
garded aa  a  standard  of  value,  than  many  other  comnioditiea,  such  ai  curu. 

And  again,  in  chapter  24  of  the  same  work,  he  says: 

We  are  too  much  accustomed  to  look  upon  the  value  of  gold  as  a  fixed  datum 
line  in  commerce;  but  in  reality  it  is  a  very  variable  thing 

Sir  Archibald  Alison  (England,  in  1-<1.~>  and  1- J.">\  says: 

The  coining  of  gold  and  silver,  which  is  universal  in  all  civil  z<-  1  nation*,  and  af- 
lo  them  one  drfluiu*  and  perm  me-nt  valu*  by  authority  ofl.iw.  ha*  no  effect 
whau-ver  in  preventing  the  fluctuations  In  the  real  value  of  the  current  coin  of 
the  realm. 

Professor  Langhlin,  of  Harvard,  in  his.  work  on  Political  Econ- 
omy (page  72),  says: 

lite  evident  that  the  name  dollar  doe«  not  alwavs  have  the  same  value, 
although  jvc-  :.k  it  does.     We  get  into  the  habit  of  using  nan. 

out  thinking  what  they  really  m.-an.    The  23.?.!  gr.»im«  in  a  gold  dollar  m:t 

i  !.  an  _••••:  -.iin'tiriiri   !,,r  r:i..ri-    «..uif!  iimw    tor  liv%«,  of  ntliet   OOSBBOfHtiM,       \V':    n  ;• 
A»  fallen  n-lativelv  to  all  otln  r  commodities,  and, 

ereo  if  the  name  dollar  i<<main*  the  same,  iu  value  has  fallen.     OIH<  mu-t  then 
offi-r  more  dollar*  than  b.-for«  for  th<>  Mine  roiiiin<Hliti>-.i      That  U,  when  mooey 
•i  value,  price*  riae;  when  mon.-y  ri*- 1  ;  ricen  full. 

we  ahall  aay  a  few  words  in  r<-gar<l  to  another  fum-tiou,  a  me*iM  of  pay- 
lag  long  contracts,  or  debU  which  run  ov.  r  a  Ion  g  t.-rin  of  year*. 

Bmptwe  that  I  loaned  you  in  18-0,  $l,o->  \.  .4:-.     In       . 

|\.0"0  bousht  a  c.-rt»in  quantity  of  rom,  wheat,  sugar,  salt,  wood,  hata,  ui 
In  1900,  when  you  are  to  pay  me  back  the  $1,000  in  moiit  .  langed. 

yon  may  give  me  b*ck  toe  »mi>  amount  of  moor ^ 
the  same  purchasing  power  ovrr  oti 

fallen  b*iw««B  1880  and  1900.  it  will  t»k-  1.  -.»  ,,,,„;,  ,-  Mime  qtiu. 

before  of  eoru,  wheat.  «tc.    If  M>,  t  h<>  $1  000  you  r 
raltt"  than  the  91, 000  I  gan-  \ou.  an  unjust  to  o 

i  borrowed  !,.-n  th-  *I  000 

In  moti-\  w..iil.!  buy  in.-  !.•«•  tli  i  ^l.oiil.l  :<•••.      *      *      ' 

the  vain.-  of  money  (gold  or  niivrri  d»e«  not  remain  the  name  for  any  1 
:  TI..      .1 !..'.:.    i  :  .      •  •  :i«nge« 

which  do  not  take  very  long  to  ••  aa  a  proper  meaaur*  of 

rain*  during  •  long  tana  of  years. 

In-  n<>l«l  *t:in<lnrd,  t! 

;!ily  r«-j;ft'  .Imtit  tin-  woil.l   tlian  an\   <>tli.-r 

that  ban  ever  appearnd  ii 
hare  nevrr 

i  .-.  P  . 


43 

In  his  "Proposals  for  an  Economical  and  Secure  Currency,"  Ri- 
cardo  makes  the  following  statement,  which  I  commend  to  the  care- 
ful attention  of  the  advocates  of  the  single  gold  standard : 

"While  a  standard  is  used,  we  are  subject  to  only  such  a  variation  in  the  value 
of  money  as  the  standard  itself  is  subject  to;  but  against  such  variation  there  is 
no  possible  remedy,  and  late  events  have  proved  that,  during  periods  of  war,  when 
gold  arid  silver  are  used  for  the  payment  of  Lirge  armies  distant  from  home,  those 
variations  are  much  more  considerable  than  has  been  generally  allowed.  This 
admission  only  proves  that  gold  and  silver  are  not  so  good  a  standard  as  they  have 
bi'.-ii  hitherto  supposed — that  they  are  themselves  subject  to  greater  variations 
than  it  is  desirable  a  standard  should  be  subject  to.  They  are,  however,  the  best 
with  which  we  are  acquainted. 

If  any  other  commodity  less  variable  could  be  found,  it  might  very  properly  be 
adopted  as  the  future  standard  of  our  money,  provided  it  had  all  the  other  quali- 
ties which  fitted  it  for  that  purpose  ;  but  while  these  metals  are  the  standard  the 
currency  should  conform  in  value  to  them,  and  whenever  it  does  not,  and  the  mar- 
ket price  of  bullion  is  above  the  mint  price,  the  currency  is  depreciated.  This 
propositionis  unanswered  and  is  unanswerable.  Much  inconvenience  arises  from 
using  two  metals  as  a  standard  of  our  money ;  and  it  has  long  been  a  disputed 
point  whether  gold  or  silver  should  by  law  be  made  the  principal  or  sole  standard 
of  money.  In  favor  of  gold  it  may  be  said,  that  its  greater  value  under  a  small* 
bulk  eminently  qualifies  for  a  standard  in  an  opulent  country. 

And  I  may  here  remark  that  it  requires  an  opulent  country  to 
maintain  the  single  gold  standard,  and  the  country  does  maintain  it 
at  very  great  expense.  I  do  not  wonder  that  he  thought  an  opulent 
country,  a  creditor  country,  the  only  one  that  ought  to  adopt  it,  for 
no  other  country  can  afford  to  adopt  it.  But,  like  many  people  who 
in  attempting  to  improve  their  condition  in  society  attempt  luxuries 
and  extravagances  which  they  can  not  maintain  and  which  force 
them  back  into  the  ranks  from  which  they  came,  so  nations  in  at- 
tempting to  establish  the  gold  standard  may  find  themselves  reduced 
from  opulence  to  poverty. 

Ricardo  continues : 

But  this  very  quality  subjects  to  greater  variations  of  value  during  periods  of 
war  or  extensive  commercial  discredit,  when  it  is  often  collected  and  hoarded,  and 
may  be  urged  as  an  argument  against  its  use.  The  only  objection  to  the  use  of 
silver  as  the  standard  is  its  bulk,  which  renders  it  unfit  for  the  large  payments 
required  in  a  wealthy  country  ;  but  this  objection  is  entirely  removed  by  the  sub- 
stituting of  paper  money  as  the  general  circulation  medium  of  the  country.  Silver, 
too,  is  much  more  steady  in  its  value  in  consequence  of  its  demand  and  supply 
being  more  regular  ;  and,  as  all  foreign  countries  regulate  the  value  of  their  money 
by  the  value  of  silver,  there  can  be  no  doubt  that  on  the  whole  silver  is  prefer- 
able to  gold  as  a  standard,  and  should  be  permanently  adopted  for  that  purpose. 

Innumerable  additional  citations  from  authors  of  repute  could  be 
adduced  to  fortify  this  position. 

It  will  thus  be  seen  that  the  fluctuations  in  tbe  value  or  purchas- 
ing power  of  both  gold  and  silver  have  always  been  admitted  by 
scientific  writers.  They  were  so  well  understood  three  centuries 
ago  thai  in  Queen  Elizabeth's  reign  (1576)  the  British  Parliament 
directed  that  the  rents  reserved  in  the  long  leases  of  certain  college 
lands  should  be  payable,  not  in  money,  but  in  wheat.  And  at  va- 
rious times  during  the  past  seventy  years  propositions  have  been 
formulated  to  substitute  for  gold  and  silver  as  a  standard  of  value 
for  deferred  payments,  a  tabular  statement  of  the  prices  of  the  prin- 
cipal articles  of  commerce,  to  be  made  by  official  authority  and 
published  from  time  to  time,  by  the  average  of  which  the  fluctua- 
tions of  gold  could  be  ascertained  and  proper  allowance  made  for 
them  in  the  settlement  of  time  transactions.  Professor  Joyous,  Prof. 
Francis  A.  Walker,  and  other  political  enconomists  of  note  have  ex- 
pressed approval  of  such  a  tabular  standard  for  long-time  contracts, 
as  securing  greater  equity  than  would  gold  as  a  measure  of  values. 

Those  who  now  assert  that  silver  has  fallen  and  that  gold  has  not 


44 

risen  in  value  arrive  at  this  conclusion  by  a  very  safe  process  of 
reasoning.  show  that  silver  has  fallen  they  measure  it  by 

gold  alone,  without  reference  to  the  general  rauge  of  prices ;  and 
then  to  prove  that  gold  has  not  risen  they  make  it  the  measure  of 
itself.  An  increase  or  decrease  of  the  value  of  either  can  not  be  as- 
ascertained  by  reference  to  the  other,  and  certainly  not  by  constitut- 
ing either  of  tin-in  astainlanl  I'.v  which  to  judge  itself.  It  would  of 
coarse  be  forever  impossible  to  show  any  change  in  the  value  of  gold 
•  •r.  or  of  anything  else,  measuring  it  by  itself.  It  is  only  by 
looking  at  the  relations  which  both  metals  boar  respectively  to  acon- 

:de  range  of  commodities  generally  dealt  in  as  well  as  to  each 

other,  that  it  can  be  ascertained  with  certainty  what  has  happened. 

:pon  consideration  of  all  the  facts  I  have  given,  but  upon 

i  he  situation,  it  must  be  obvious  that  gold  has  risen  and 

will  continue  to  n>e  in  value  as  long  as  its  volume  decreases  and  the 

.d  lor  it  increases.    Sine.-  1-iiO,  when  gold  constitued  7?  per  cent, 
of  the  combined  yield  of  the  two  metals,   it  has  diminished  not  only 
in  relative  proportion  to  the  yield  of  silver,   but    it  has  dimi: 
absolutely.      For  the   live  years  ending  with   I'M)  the  yield    of  gold 
throughout   the   world   was  $137,000,000  a  year ;  for  the   live 

„'  1889  the  yield  was  but  sllO,000,000  a  year.     If.  as  claimed 

advocates  of  the  single  gold  standard,  an  increase  in  tin 
of  si  Ivei  decreases  the  value  of  silver,  by  what  system  of  lo- 
they  deny  that  a  decrease  in  the  supply  of  gold  increases  the  value  of 
gold! 

In  a  late  issue  of  the  London  Economist,  that  of  April  iJfi,  1490,  I 
find  an  editorial  article  relating  to  the  recent   discii--ii>n  on 
allism  in  the  British  House  ot    Commons.     That   article  comments 
somewhat  sharply  on  Mr.  Smith's  assertion  that   "a  conspirac 
been  formed  among  tin-  financial  class  in  Europe  and  America  to  get 
rid  of  silver  as  full-valued  money  in  order  to  increase  the  value  of 
gold,  in  which  their  revenues  are  paid."     In  the  course  of  his  com- 
•litor.  by  "confession  and  avoidance."  admits  our  whole 
contention  as  to  the  rise  of  gold  and  the  fall,  as  a  natural  couse- 
-  of  commodities.     He  sa; 

It  may  not  be  amis*,  however,  to  point  out  that  the  increase  in  the  exchange- 
able ralne  of  cold  ha*  been  by  no  means  such  a  gain  to  the  financial  clam  aa  he 
in  common  with  many  others supponn ;  for  advantage  has  been  very  largely  taken 
of  it  t«.  cut  .liiwn  tin-  retain  uimii  tln<  capital  which  the  flnano  al  clasfle*  1 
vetted.     It  hi*  favored  debt  convention  scheme*,  and  it  has  been  one  of  t)i«  in- 
flnenoes  that  have  caused  the  rate  of   uterest  in  general  to  >• 
that, all  round,  th     yi«-l<l  of  inventracntft  is  now  veryapjn  in  it  was 

fifteen  yearn  ago.  'The  idea  that  th<<  rrcilitor  clasM  have  realised  unmixed  gains 
and  the  debtor  class  have  suffered  unmitigated  losses  by  the  alteration  in  • 
•basing  power  of  gold  is  thus  altogether  fallacious,  'there  has  in  their  case,  as 
in  all  others,  been  a  species  of  oompuUory  give  and  takn.  Each  has  gained  and 
•arh  has  lost  something,  and  now  that  the  pr<  ce«s  of  readjustment  hao  been  car- 
ried so  far  it  would  be  unwise  to  the  last  degree  to  unsettle  everything  again  by 
surh  legislation  as  the  blroetalliaU  propose. 

editor  oft.  !>o  commended  for  at  least  o«e 

thing.     He  doen  not  quibble  as  to  the  most  important   point  in  the 
.  ••  frankly  admit*  that  gold  has  risen,  and 
does  not,  as  some  others  do,  attribute  the  fall  of  price*  to  imp 
menu  in  method*  of  product  ion. 

iiso  admit*  tha;  ily  with  and  caused    by  tin-    i 

gold  there  has  been  a  great  decline  in  the  mtes  of  interest,  and, 
strangely, <  ,|  f,,r  the  rise  in  the 

••  ability  t  -lie  debt  into  one  tearing  a 

lower  rate  of  interest,  or.  as  :  4  to  "debt" 

" 


45 

He  does  not  inform  us  how  any  compensation  can  be  made  to  the 
the  debtor  for  the  time  the  debt  has  been  running,  as  to  which  it  can 
not  be  converted,  nor  for  the  enhanced  amount  exacted  from  the  cur- 
rent earnings  of  labor  by  the  rise  in  the  value  of  money  to  pay  taxes 
and  the  expenses  of  Government,  nor  for  the  loss  entailed  "on  the 
debtor  whose  property  is  mortgaged  on  long  time,  where  the  holder  of 
the  mortgage  refuses  to  convert  it  into  an  obligation  bearing  a  lower 
rate  of  interest  than  originally  contracted  for.  He  suggests  no  method 
by  which  to  make  whole  those  who  have  lost  their  property  through 
sheriff's  sale  by  reason  of  falling  prices  and  the  rise  in  the  value  of 
money.  Neither  does  he  state  how  long  it  will  be  before  the  next 
confiscation  is  to  take  place,  by  reason  of  the  continued  operation  of 
the  cause  that  produced  the  first.  But  he  has  been  frank  enough 
to  concede  (what  is  never  disputed  except  when  the  money  ques- 
tion is  under  discussion)  that  there  has  been  a  rise  in  the  exchange- 
able value  of  gold,  and  conceded  its  natural  sequence,  a  fall  in  the 
rates  of  interest. 

IMPROVED  METHODS  OF  PRODUCTION. 

In  order  to  justify  their  position  it  becomes  necessary  for  the  ad- 
vocates of  continued  demonetization  of"  silver  to  insist  that  the  fall 
of  prices  is  not  due  to  the  rise  in  the  value  of  gold  but  to  improved 
methods  of  production. 

Whatever  the  cause  to  which  it  is  to  be  ascribed,  the  undoubted 
fact  is  that  a  fall  of  prices  throughout  the  western  world  set  in 
concurrently  with  the  reduction  of  the  world's  money  volume  by  the 
demonetization  of  silver.  It  was  well  understood  at  the  time  by 
those  who  had  given  consideration  to  the  subject  that  demonetiza- 
tion alone  would  effect  that  result.  This  is  manifest  from  an  article 
in  the  London  Daily  News,  a  paper  of  exceedingly  large  circulation, 
quoted  in  the  Journal  of  the  Statistical  Society  of  England  for  1873, 
page  395.  Referring  to  the  adoption  of  the  single  gold  standard  by 
Germany  t,h«  Daily  News  said  : 

As  the  annual  new  supply  of  gold  throughout  the  world  is  reckon*- d  at  little 
more  than  £20,000,000  ($100,000,000),  and  the  usual  demand  for  miscellaneous  pur- 
poses is  very  large,  it  follows  that,  if  the  German  Government  perseveres  in  its 
policy,  the  strain  upon  existing  stocks  and  currencies  of  gold  will  be  most  severe, 
for  a  time,  at  least,  unless  the  annual  production  of  gold  should  suddenly  increase, 
the  money  ma:  kets  of  the  world  are  likely  to  be  perturbed  by  this  bullion  scarcity, 
and  the  fall  in  the  value  of  gold 

which  means  the  rise  in  prices  that  for  some  time  had  prevailed ; 
of  which  so  much  has  been  heard,  will  be  checked  or  reversed. 

The  yield  of  gold  did  not  "  suddenly  increase,"  and  the  intelligent 
prophecy  of  the  Daily  News  was  fully  realized,  not  merely  to  the 
extent  of  a  check  to  the  rising  prices ;  (or,  as  it  is  styled  by  the  Daily 
News,  a  check  to  the  "fall  in  the  value  of  gold,")  but  to  the  extent 
of  an  immediate  rise  in  the  value  of  that  metal,  and  a  persistent  and 
deplorable  fall  in  the  general  range  of  prices. 

This  prophecy  that  the  "fall  in  the  value  of  gold"  would  be 
checked  by  the  demonetization  of  silver  ;  or,  better,  reversed  by  it, 
was  welcome  reading  to  the  creditor  and  income  classes  of  England 
and  of  the  world. 

That  it  was  "reversed,"  and  the  value  of  gold  appreciated,  is  as 
plain  as  that,  one  being  subtracted  from  two,  there  is  but  one  for  a 
remainder. 

The  immediate  fall  in  prices  of  commodities  was  the  natural,  the 
anticipated,  and  the  deliberately  intended  result  of  that  movement. 

But  we  are  now  assured  that  this  fall  is  not  due  to  any  monetary 


46 

•cause,  but  to  the  greater  efficiency  of  machinery  iu  the  production 
of  commodities. 

No  advocate  of  an  increased  volume  of  money  denies  that  in  a  few 
departments  of  manut'ai -tare  there  have  since  1H73  been  improve- 
ments tending  to  economize  labor  and  cheapen  products  ;  but  they 
emphatically  deny  ami  challenge  proof  that  improvements  of  mere 
detail  in  the  manufacture  of  some  articles  will  account  for  the  cxtra- 
ordiuary  fall  of  price  since  that  time  in  almost  every  product  of  indus- 
try. We  arc  also  told  that  the  development  of  the  system  of  tran.s- 
•  •II,  both  by  land  and  sea,  have  tended  to  lower  the  price  of  com- 
modities to  the  consumers.  I  grant  it.  But  we  had  those  improve- 
ments before  1873. 

The  inventions  made  between  1873  and  1890,  the  period  of  falling 
.  were  no  more  important  or  radical  in  their  effect  on  iu- 
ili-tl  no  more  to  cheapen  commodities,  than  did  those 
from!  ..  the  period  of  rising  prices.  Indeed  the  inventions 

which  preceded  1873  were  as  a  whole  much  greater  in  scope,  more 
far-reaching  in  result,  and  more  revolutionary  in  their  effects  on  in- 
dustry, than  those  of  the  later  period.  All  the  great  basic  improve- 
ments had  been  invented,  and  had  been  incorporated  with  the  in- 
dustrial system  of  ail  civih/.ed  countries  long  before  1H73,  if  we 
except  the  electric  light  and  the  telephone.  We  have  had  the  steam 
engine,  the  cot  ton  gin,  and  the  spinning-jenny  since  the  last  century; 
the  railroad  and  the  steam-ship  since  the  '30's;  the  telegraph,  the 
mechanical  reaper,  Hteam-plow,  and  other  agricultural  labor-saving 
•  s  since  the  '40's;  the  sewing  machine  since  1854,  and  the  Bes- 
semer process  and  steel  rail  since  1857. 

The  forced  construction  into  which  their  position  drives  the  advo- 
cates of  the  gold  standard  is  well  illustrated  in  a  went  number  of 
a  magazine  of  high  standing  in  this  country,  in  which  I  find  the 
'  ing: 

But  if  It  be  demurred,  doen  not  a  debt  incurred.  My,  ten  year*  ago  iron  ire  to- 
day more  wheat  or  iron  fur  it*  untiafiwtion  than  the  sum  could  have  bought  wb«n 
Drat  borrowed  I  Certainly,  but  the  wheat  or  iron  represents  no  more  laUir  now 
then  it  did  ten  yean  ago.  ind  it*  increano  in  quantity  stands  for  the  new  efficiency 
which  applied  science  has  bestowed  on  toil. 

Observe  how  deftly  the  writer  places  iron,  in  the  manufacture  of 
which  there  have  admittedly  been  some  Improvement*,  in  the  same 
category  with  wheat,  in  the  production  of  which  the  improvement* 

i  any  recent  period  have  been  of  the  most  trifling  chai 
It  will  be  exceedingly  difficult  to  convince  the  farmers  of  this  coun- 
try, whose  mortgages  are  eating  up  the-  proceeds  of  their  labor, 
that  the  enormous  decrease  iu  the  debt-paying  power  of  their  prod- 
acts  is  made  up  to  them  iu  "the  new  elncuncy  which  applied 
science  has  bestowed  on  toil." 

As  well  might  it  be  maintained  that  the  rise  of  prices  and  the  con- 
current way«  of  uni  vernal  i  experienced  after  1849,  was  not 
1*0  of  the  world's  money  stock  from  the  minesof  Cali- 
•.  and  Australia,  but  to  some  sudden,  unaccountable,  and  com- 
i»ss  of  all  improvements  theretofore  attained  in  the  arts  and 
industries  of  the  world. 

KmtCT  Or  CHECKS  A!tD  CUtAHP«O  HOUSES. 

Bat  it  is  said  that  checks,  notes,  draft*,  bills  of  exchange,  and  the 
facilities  afforded  by  clearing- houses  effect  such  economy  in  the  use 
of  money  that  it  goes  fart  he  i  now  than   formerly,  and  that  th. 
so  large  a  volume  of  money  a«  was  formerly  needed  i*  not  needed  at 
present.     It  is  sought  thus  to  escape  the  conclusion  that  the  fall  of 


47 

prices  is  the  result  of  a  shrinkage  of  the  volume  of  money,  or  at  least 
to  imply  that  if  the  money  volume  has  been  shrinking  the  agencies 
mentioned  have  served  to  mitigate,  if  not  entirely  to  counteract,  the 
effects  of  such  shrinkage.  This  is  in  substance  to  claim  that  how- 
ever contracted  the  money  volume  of  a  country  may  become,  the 
system  of  checks  and  clearing-houses — on  the  principle  of  the  com- 
pensating balance — will  expand  in  a  proportion  directly  correspond- 
ing to  the  contraction  of  the  currency;  that  the  greater  the  reduction 
of  the  volume  of  money  in  the  country  the  greater  the  increase  in 
the  transactions  of  the  clearing-house. 

Nothing  more  absurd  could  be  conceived.  If  this  view  were  cor- 
rect, it  would  make  no  difference  whether  the  amount  of  money  in 
circulation  were  large  or  small ;  a  million  dollars  would  be  as  effica- 
cious as  $100,000,000,  and  even  one  dollar  as  effective  as  a  million  dol- 
lars ;  and  if  we  suppose  the  last  dollar  to  have  disappeared  from  cir- 
culation, then,  according  to  the  sweeping  and  pretentious  claims  set 
up  for  the  clearing-house  system,  we  could  dispense  altogether  with 
the  use  of  money  and  rely  exclusively  on  checks,  drafts,  and  bills  of 
exchange. 

That  checks  and  clearing-houses  are  a  great  convenience  to  com- 
merce is  not  denied.  They  serve  to  a  certain  extent  to  make  more 
effective  the  money  volume  of  a  country.  By  the  clearing  house  sys- 
tem of  off-setting  the  demands  of  the  several  banks,  one  against  the 
other,  and  requiring  payment  in  cash  of  the  balances  only,  large 
amounts  of  loans  may  remain  undisturbed  and  greater  stability  of 
industrial  conditions  be  secured. 

Clearing-houses,  however,  were  not  established  primarily  for  the 
convenience  of  commerce,  but  for  the  profit  of  bankers.  Whatever 
amounts  of  money  are  economized  by  means  of  those  institutions 
bring  compensation,  by  way  of  interest,  to  the  banks.  We  may, 
therefore,  rely  upon  their  being  utilized  to  the  utmost  under  all  cir- 
cumstances. 

But,  however  much  checks  and  clearing-houses  may  economize 
the  use  of  money,  they  are  no  novel  devices.  They  are  not  some 
untried  and  newly-invented  instrumentalities.  Checks  have  been, 
in  use  ever  since  the  invention  of  banks.  The  clearing-house  system 
was  established  in  this  country  in  1853.  Contributing,  as  it  does 
contribute,  to  the  pecuniary  profit  of  the  banks  by  making  possi- 
ble an  economy  in  the  use  of  invested  money,  which  the  banks  have 
loaned  out,  and  on  which  they  are  drawing  interest,  the  system  has 
grown  with  the  growth  of  the  business  of  the  country.  It  will 
undoubtedly  continue  to  grow,  but  with  no  greater  acceleration 
than  population  and  business  will  warrant. 

As  it  has  been  a  part  of  the  banking  machinery  of  the  country  for 
nearly  forty  years,  and  during  that  period  has  been  utilized  to  the 
utmost,  the  conditions  of  its  existence  and  utilization  have  long  since 
hecome  static  conditions.  The  demands  for  currency  have  borne  re- 
lation to  the  needs  of  business,  with  clearing-house  facilities  in  full 
sight  and  operation;  and  at  all  seasons,  in  the  adjustment  of  prices, 
those  facilities  have  had  full  force  and  effect.  Assuming  that  at  any 
given  period  the  business  of  the  country  were  conducted  with  a  given 
volume  of  money, plus  a  certain  volume  of  clearing-house  exchanges, 
then,  at  a  later  period,  an  increase  of  business  would  demand  an  in- 
crease in  the  volume  of  money,  plus  a  proportionate  increase  in  the 
volume  of  clearing-house  exchanges;  having  had  this  system  in 
full  and  effective  use  for  forty  years,  it  is  as  absurd  to  ascribe 
the  fall  of  prices  in  the  last  half  of  that  period  to  any  economy  in 


48 

the  use  of  mom  by  the  clearing-house  s\  -  -.vonld 

be  to  a  i't  — the  ;•(-•< 

•'nut  took  place  in  tin-  tirst  lialf  of  tin-  same  period. 

THK  PROOF  AFFORDED  BT  THE  PALL  OK 

If  further  piont   were  needed  that  gold  has  risen  in  \alue,  it  is.  as 

lain,  to  In-  fouinl   in  the  coincident  fact  •  >!   a  deoreaSQ  " 
»t  iiiti-rcst  <>n  lirst-class  securities.     That  decrease  has  kep- 

step  and  pace  with  the  rise  in  tin-  value  of  in \v. 

The  rise  in  the  value  of  gold,  as  shown  by  comparison  will, 

iiuinlierH  of  articles  of  commerce,  h  and    10  per 

rate  of  interest  on  gilt-edged   scouritii  -  eorre- 

:>g  decline.     Hut  unfortunately  for  the  struggling  people  of  the 

country,  the  fall  in  the  rate  of  interest  on  farm  mortgages  and  on 

from  money  centers  has  been  nothing  li. 

nor  has  it  been  so  great  as  the  fall  in  the  price  of  agricultural  lands, 
and  in  th-  "t"  labor. 

at  a  new  axiom  should  be  added  to 

of  political  ecoii"  !y.  that  as  the  purchasing  pow< 

increases,  i:  -iroducing  power  decreases,  ami   in   aliout    the 

same  r  .  when  the  purchasing  pou.  : 

decreases,  it  producirj:  j)<»\\  -<-s.     In  other  \\ords. 

-  rise  inte:  prices  fall  interest  tails.      When 

:i  volume  and  decreasing  in  value.  ]iri>-. 

and  it-  Todnctive  cnterprisrs  iu-comes  mor<  IT.. til  able, 

and  a-  •  ;ice  interest  rises.     When  it  isile< Ti-a.-inu'  in  \olnme 

.'iisequently    increasing    in   value,   prices   fall,    investment    in 
d  productive  enter;'  ;is  and  unprofit- 

able, and,  as  a  consequence,  it   avoids  t!:'  :ment 

•  Is  and   gi  '  ;u>tly  termed  "  money-1'ii; 
Whii  :.d  contilli. 

Some  thirteen  >  in  a  little  prop  'ining 

the  rates  of  interest.  -at  credit  to  i.  t,  but 

ir  years  after  the  •!•  before  tin- 

rates  of  int«Test  Iiad  materially  fallen,  and  when  the  Maine  conten- 
tion was  made  that  in  rnad  u-ly.  that  money  was  cheap  be- 
cause interest  was  low,  and  that  the  policies  ni  th--  country  wen- 
wise  because  onr  credit  stood  on  such  a  high  jtlane.  1  submit  led  to 
ens  the  report  of  the  Monetary  Commission,  from  which  I 
quote: 

Money  o*n  be  borrowed  TCA>\.  oecnrities  aa  lx»nd«  whloh  nt<> 

buwsl  on  the  uicnt,  or  \\\«>\\  i: 

Mtd  itockt  of  tirnt  cla.iB  t 

•  •*  arc  practically  a  tax  upon  the  en 
Nfioni 

MM  •  •!.•!  I  "!.•'•  :it  ttmfmt  •  •l.-m.-.lh  ],•«  ratt-s.     TbeM  i""  niicl  ..••:.:   :  r.it.-s 

I-  r  -:•]'..      ..•!..  .1,.:  ..i<;-.  •:   1,,    '•  .    .,-,..  i  •!,,«,,:.       •,':!"..,•      il.il  u.n    .,r  .'Vi-n  !i 

proof  of  a  »ufflelent  clrooUtion,  are  anmisUkabln  eridenoeof  a  c. 
in»«-<i  by  a  deereacinK  nn<I  r 

•bowing  thai 

Tbwe  seed  be  no  b*«t«  in  n-fuudin- 
and  considered  low.    Unleaa  th. 

i. .11 1  I  a.   illl^llinurx    l,\    ,1.  !,.,,:    .   •  V  ,  r   1H  <  l.r,  k- <!      I  M  .11. N  I .,  M  I  1 1)  «  a  lull .'  ll  loW.T 

:  thau  any  yet  ofl. 

in   K'.ir.'i-.  .      \Vhri,  thi-iiioiii-.    »!.„  I.  ,s,|...  ,.i:-h   i.j    ii, il).:    ..-.,:,    l.illn^    I  }..•  l.-nil.T 

re«elre«  intorect,  bat  fhi.ii  H  •  i,-a*t»\  rain. 

principal  when  It  Urrtumcdtohiiu.     A  loan  of  mom-  \  m.i<lf  in  1809,  If  repaid  in  1848, 

J(..Vt» 


49 

would  have  been  repaid  with  an  addition  of  145  per  cent,  in  the  purchasing  power 
of  principal  and  interest,  besides  all  the  interest  paid.  Those  who  have  loaned 
money  to  this  Government  since  1861  have  already  received  nearly  aa  much  in  the 
increased  value  of  their  principal  as  in  interest,  and  all  the  probabilities  are,  in 
respect  to  the  four  per  cent,  thirty-year  national  bonds  now  being  negotiated,  if 
they  are  redeemed  in  gold,  that  more  profit  will  be  made  by  the  augmentation  in 
the  value  of  principal  than  through  interest.  Indeed  the  signs  of  the  timesare,  that 
the  bonds  of  a  country  possessing  the  unbounded  resources  and  stable  institutions 
of  the  United  States,  payable  in  gold  at  the  end  of  thirty  years  without  any  inter- 
est whatever,  would,  through  the  increase  of  the  value  of  that  metal,  prove  a  most 
profitable  investment. 

All  the  facts  of  the  situation  to-day  fully  bear  out  the  statements 
I  then  made. 

So  determined  are  the  advocates  of  the  single  gold  standard  in 
defending  the  wisdom  of  its  maintenance  that  facts  whose  existence 
would  at  ordinary  times  be  readily  admitted,  are,  during  a  discus- 
sion of  the  money  question,  pointedly  denied.  For  example,  within 
the  past  few  weeks  we  have  seen  in  various  eastern  newspaper  con- 
tributions from  prominent  writers  taking  direct  issue  with  the  advo- 
cates of  silver  as  to  the  prevalence  of  general  distress  throughout 
the  country.  They  declare  that  there  is  no  such  distress,  assert  that 
they  have  looked  for  it  in  vain,  and  derisively  inquire  where  it  is. 

Perhaps  the  best  authority  I  can  cite  in  response  to  this  inquiry 
is  the  principal  commercial  daily  journal  of  the  east,  the  New  York 
Journal  of  Commerce,  itself  one  of  the  most  ardent  and  uncompro- 
mising advocates  of  the  gold  standard.  In  an  editorial  article  in 
its  issue  of  January  11, 1890,  that  journal  said  : 

FAILURES  IN  BUSINESS. 

The  public  have  been  startled  by  the  announcement  that  during  the  year  1889 
there  were  11,719  business  failures  in  the  United  States,  against  10,587  in  1888  and 
9,740  in  1S87.  The  estimated  liabilities  of  last  year's  insolvents  were  $140.359,000 
and  the  assets  were  $70,599,000.  against  $120,242, UOO 'liabilities  and  $61, 999, 000  assets 
for  the  failures  of  the  previous  year.  Thus  the  failures  in  1889  were  more  in  num- 
ber and  far  greater  in  liabilities  than  for  1888,  and  the  proportion  of  assets  to  the 
obligations  shows  that  the  total  insolvency  was  more  disastrous.  Why  in  u  sea- 
son of  profound  peace,  with  no  blighting  frosts  or  withering  droughts,  and  the 
most  abundant  yield  from  the  field,  forest,  and  mine  so  many  in  business  have 
gone  to  the  wall,  no  one  seems  able  to  answer.  Many  have  tried  their  hand  at  a 
solution  of  the  problem,  and  not  one,  as  far  as  we  can  discover,  ha«  satisfied  even 
himself  with  the  result  of  his  investigations. 

HAS  SILVER  FALLEN? 

In  order  to  ascertain  Avhether  silver  really  has  or  has  not  fallen 
in  value,  it  is  necessary  that  all  the  facts  be  taken  into  account 
and  the  situation  looked  at  from  a  correct  point  of  view.  If  a  person 
be  seated  in  a  boat  that  is  headed  to  the  stream  and  wishes  to  test 
whether  or  not  he  is  making  headway  he  must  keep  in  view  not  the 
stream,  but  the  shore.  The  occupant  of  a  railroad  car  who  observes 
a  moving  train  on  a  contiguous  and  parallel  track,  frequently  thinks 
his  own  train  at  a  stand-still,  when  in  fact  it  may  be  in  motion. 

Whenever  a  rise  or  fall  appears  to  take  place  in  the  price  of  any 
one  article  or  commodity,  that  is  to  say  whenever  a  difference  takes 
place  in  the  relation  which  that  article  bears  to  money — all  other 
commodities  remaining  unchanged — such  difference  must  naturally 
and  properly  be  attributed  to  changed  conditions  affecting  the  com- 
modity, and  not  to  a  change  in  the  value  of  money.  But  wherever 
there  is  a  fall  in  prices  throughout  the  whole  range  of  commodities 
then  it  is  clear  that  this  change  is  mainly  due  to  a  change  in  the  value 
of  money.  Such  however  is  the  force  of  education  and  habit  that 
the  masses  of  the  people  are  slow  to  suspect  any  change  in  the 
standard  by  which  they  have  been  accustomed  to  gauge  or  meas- 
ure all  values.  Indeed  they  find  it  difficult  to  understand  how  un- 
JOUES 4 


50 

der  any  circumstances  any  change  can  take  place  in  it.  Having 
their  eyes  fixed  on  the  standard,  and  on  that  alone,  they  naturally 
attribute  to  the  articles  measured,  and  not  to  the  standard,  any 
difference  that  may  seem  to  arise  in  the  relation  they  bear  to  each 
otht-r. 

Bat  the  apparent  is  not  always  the  real.  Nothing  seems  more 
warranted  by  the  evidence  of  our  senses  than  that  the  earth  is  a 
stationary  abject,  while  the  sun  revolve*  around  it.  For  thousands 
of  yean  the  world  was  convinced  of  the  truth  of  the  geocentric 
theory  of  the  universe,  and  millions  of  men  have  lived  and  died  in 
the  confident  belief  that  this  planet  was  immovably  fixed  in  space, 
while  the  sun  was  a  rolling  and  ever-shifting  body.  Even  yet, 
among  the  mass  of  mankind,  so  ever-present  is  this  impression, 
.1  from  ocular  demonstration,  that  in  spite  of  the  declara- 
tions of  science,  the  world  continues  in  common  use  the  phrases 
which  originally  described  the  process  that  took  place,  us  men  un- 
derstood it;  hence  we  speak  of  the  "  rising  "  and  of  the  "  sett  ing  " 
of  the  son.  ID  the  same  way  we  speak  of  the  rise  or  fall  in  the 
value  of  commodities,  without  being  particular  to  note  whether  the 
change  that  has  taken  place  is  strictly  a  change  in  the  value  of  the 
article  itself  or  a  change  in  the  money  w  ith  which  its  value  is  meas- 
ured. Perhaps  I  can  best  illustrate  my  meaning  by  an  allegory: 

THE  BATTLB  OF  THE  HTAJCUARD8.      THE   ALIEGOKT  OF  THE  CLOCKS. 

In  an  ancient  village  there  once  stood  a  gold  clock,  which,  ever 
since  the  invention  of  clocks  had  been  the  measure  of  time  for  tin- 
people  of  that  village.  They  were  proud  of  its  beauty,  it«  workman- 
ship, its  musical  stroke,  and  the  unfailing  regularity  with  which  it 
heralded  the  passing  hours.  This  clock  had  been  endeared  to  all 
the  inhabitants  of  the  village  by  the  hallowed  associations 
wi:h  which  it  was  identified.  Generation  after  generation  it  had 
called  the  children  from  far  and  wide  to  attend  the  village  school. 
its  fresh  morning  peal  had  set  the  honest  villagers  to  labor ;  its  noon- 
day notes  bad  called  them  to  refreshment  ;  it*  welcome  evening 
chime  had  summoned  them  to  rest.  From  time  immemorial,  on  ail 
festive  occasions,  it  had  rung  out  its  merry  tones  to  atwemble  the 
young  people  on  the  green;  and  on  the  Sabbath  it  had  advertised 
to  all  toe  countryside  the  hour  of  worship  in  the  village  cluin-h. 
So  perfect  was  its  mechanism  that  it  never  needed  repan 
proud  were  the  people  of  this  wonderful  clock  that,  it  became  tin- 
standard  for  all  the  country  round  about,  and  the  time  which  it 
kept  came  to  be  known  as  the  gold  standard  of  time,  which  was  uni- 
versally admitted  to  be  correct  and  unchanging. 

In  the  course  of  time  there  wandered  that  way  a  queer  character, 

.maker,  who  being  fully  instructed   in  the    inner  workings  of 

time-tellers,  and  not  having  inherited  the  traditions  of  that  village, 

did  not  regard  this  clock  with  the  veneration  accorded  N>  it  by  the 

t.     Toth.-ir  astonishment  he  denied  that  there  was  really  any 

ling  a*  f»  gold  standard  of  time  :  and  in  order  to  prove  that  the 

material,  gold,  did  not  nionopoli/o  all  the  qualities  cbaract< 

of  clocks,  be  placed  alongside  the  -..hi  <•!... -k,  another  clock,  of  sil- 

i   .locks  at  l"2  noon.       1'or   a  long  time  the  clocks 

ran  aloof  in  almost  perfect  accord,  their  <>n!\    disagreement  being 

that  of  an  occasional  second  or  two,  and  even  that  disagreement 

only  at  rare  intervals,  such  as  might  naturally  occur  with  the  I..  -; 

of  clocks.     But  the  Council  of  the  village,    in  their    admiration    for 

the  gold  clock,  passed  an  in  requiring   that   all   the  weights 

(the  motive  power)  of  the  silver  clock,  except  one,  be  removed  from 


51 

it,  and  attached  to  those  of  the  gold  clock.  Instantly  the  clocks  be- 
gan to  fall  apart,  and  one  day, -as  the  sun  was  passing  the  meridian,  the 
hands  of  the  gold  clock  were  observed  to  indicate  the  hour  of  1,  while 
those  of  the  silver  clock  indicated  12.15.  At  this  everybody  in  the 
village  ridiculed  the  silver  clock,  derided  the  silver  standard,  and 
hurled  epithets  at  the  individual  who  had  had  the  temerity  to 
doubt  the  infallibility  of  the  gold  standard. 

Finally,  the  divergence  between  the  clocks  went  so  far  that  it 
was  noon  by  the  gold  standard  when  it  was  only  6  a.  m.  by  the 
silver  standard,  so  that  those  who  were  guided  by  the  gold  stand- 
ard, notwithstanding  that  it  was  yet  the  gray  of  the  morning,  in- 
sisted on  eating  their  mid-day  meal,  because  the  gold  standard  in- 
dicated that  it  must  be  noon.  Aud  when  the  sun  was  high  in  the 
heavens,  and  its  light  was  shining  warm  and  refulgent  on  the  dusty 
streets  of  the  village,  those  who  observed  the  gold  standard  had  al- 
ready eaten  supper  and  were  preparing  for  bed. 

But  this  state  of  things  could  not  last.  It  was  clear  that  the  dif- 
ference between  the  standards  must  be  reconciled,  or  all  industry 
would  be  disarranged  and  the  village  ruined. 

Discussion  was  rife  among  the  villagers  as  to  the  cause  of  the  dif- 
ference. Some  said  the  silver  clock  had  lost  time ;  others  that  both 
clocks  had  lost  time,  but  the  silver  clock  more  than  the  gold ;  while 
others  again  asserted  that  both  clocks  had  gained  time,  but  that  the 
gold  clock  had  gained  more  than  the  silver  clock. 

While  this  discussion  was  at  its  height  a  philosopher  came  ajong 
and  observing  the  excitement  on  the  subject  remarked,  "  By  meas- 
uring two  things,  one  against  the  other,  yon  can  never  arrive  at  any 
determination  as  to  which  has  changed.  Instead  of  disputing  as  to 
whether  one  clock  has  lost  or  another  gained  would  it  not  be  well  to 
consult  the  sun  and  the  stars  and  ascertain  exactly  what  has  hap- 
pened." 

Some  demurred  to  this  because,  as  they  asserted,  the  gold  standard 
was  unchanging  and  was  always  right  no  matter  how  much  it  might 
seem  to  be  wrong ;  others  agreed  that  the  philosopher's  advice  should 
be  taken.  Upon  consulting  the  sun  and  the  stars  it  was  discovered 
that  what  had  happened  was  that  both  clocks  had  gained  in  time 
but  that  the  gain  of  the  silver  clock  had  been  very  slight,  while  that 
of  the  gold  clock  had  been  so  great  as  to  disturb  all  industry  and 
destroy  all  correct  sense  of  time. 

Notwithstanding  this  demonstration,  there  were  many  who  ad- 
hered to  the  belief  that  the  gold  standard  was  correct  and  unchang- 
ing, and  insisted  that  what  appeared  to  be  its  aberrations  were  not 
in  reality  due  to  any  fault  of  the  gold  clock,  but  to  some  convulsion 
of  nature  by  which  the  solar  system  had  been  disarranged  and  the 
planets  made  to  move  irregularly  in  their  orbits. 

Some  of  the  people  also  remembered  .having  heard  at  the  village 
inn,  from  travellers  returning  from  the  East,  that  silver  clocks  were 
the  standard  of  time  in  India  and  other  barbarous  countries,  while 
in  countries  of  a  more  advanced  civilization  gold  clacks  were  the 
standard.  They  therefore  feared  that  the  use  of  the  silver  clock 
might  have  the  effect  of  degrading  the  civilization  of  the  village  by 
placing  it  alongside  India  and  other  barbarous  countries.  And  al- 
though the  great  mass  of  the  people  really  believed,  from  the  dem- 
onstration made,  that  the  silver  standard  of  time  was  the  better  one, 
yet  this  objection  was  so  momentous  that  they  were  puzzled  what 
course  to  pursue,  and  at  last  advices  were  consulting  the  manufac- 
turers of  gold  clocks  as  to  what  was  best  to  be  done. 
JOJTBS 


52 


Now  oar  gold  standard  men  are  in  the  position  of  those  who  first 
refuse  to  look  at  anything  beyond  the  two  things,  gold  and  silver, 
to  see  what  has  happened,  and  who,  when  it  is  finally  demonstrated 
that  all  other  things  retain  their  former  relations  to  silver,  still  per- 
sist that  the  law  which  makes  gold  an  unchanging  standard  of 
measure  is  more  immutable  than  that  which  holds  the  stars  in  tli<-ir 
courses.  If  they  will  compare  gold  and  silver  with  commodities  in 
general,  to  see  how  the  metals  have  maintained  their  n-hn  in- 
to one  another  but  to  all  other  things,  they  will  find  that  instead  of 
a  fall  having  taken  place  in  the  value  of  silver,  the  change  that  has 
really  taken  place  is  a  rise  in  the  value  of  both  gold  and  silver,  the 
rise  in  silver  being  relatively  slight  while  that  of  gold  has  been 
ruinously  great.  And  those  who  do  not  shut  their  eyes  to  the  truth 
must  see  that  the  change  of  relation  between  the  metal*  has  been 
effected  by  depriving  nilver  of  its  legal-tender  function,  as  the  want 
of  accord  between  the  clocks  was  brought  about  by  depriving  tin- 
silver  clock  of  a  portion  of  its  motive  power — the  weights.  The 
only  thing  that  has  prevented  a  greater  divergency  betweeu  the 
metals  is  the  limited  coinage  by  the  United  States — the  single  weigh  t 
that,  withheld  from  the  gold  clock,  prevented  its  more  ruinous 
gain. 

TBK  PURCHABISO  I'OWEB  OF  8ILVKB  IK   1873  AND  1889. 

If  I  can  show  that  for  a  period  of  seventeen  years,  since  its  demon- 
etization in  1 .-?:;,  silver  has  lost  none  of  its  purchasing  power,  none  of 
its  command  over  commodities;  that  is  to  Hay,  if  I  can  show  that  ll-Jj 
grains  of  silver  to-day,  uncoined,  and  shorn  by  hostile  legislation  of 
its  principal  element  of  value — the  money  use — will  buy  as  much  as 
would  41*^  grains  of  silver  in  1873  (when  our  silver  dollar  bore  a  pre- 
mium over  gold)  of  all  the  articles  that  enter  into  the  daily  consump- 
tion of  the  people,  it  must  be  manifest  that  silver  has  not  fallen  in 
valne. 

I  present  a  table  which  I  shall  aak  to  have  inserted  in  the  RECORD 
as  part  of  my  remarks,  showing  the  purchasing  power  of  412}  grain* 
of  Mlver,  nine-tenths  fine,  in  1873  and  1890, respectively,  so  far  as 
concerns  several  leading  articles  of  daily  consumption. 

The  table  is  as  follows: 

Comparative  purchasing  pover  of  412$  grains  nlvrr,  nine-tenths  fine, 
in  1873  and  1890,  respectively. 


412J  grata  •Uver  woul.l  buy— 

1873. 

1890. 

Wheat... 

. 

0.87 
LM 

:.  M 
0.06 
0.07 
12.89 

|    V 

r,  ;:! 

4.Z7 

I.M 

1.97 
B.  71 
0.05 
O.OC 
11.75 
4.63 
0.94 
10.34 

Corn  

do 

Cotton  

B«et  BOM 

i. 

.    .      do 

L»rd  

(  *'•  i-«  %c- 

do 

.Su  -*r 

..    ..do 

ES 

From  this  tabl*  it  conclusively  appears  that  while  in  1873  thestand- 
V«T  dollar  of  412$  grains,   which  then  bure  a   ini-niiiim  over 

the  gold  dollar,  would  pnrcham'f»tir-n  ftha  of  a  bushel  of  wheat ;  to- 
day the  satoe  quantity  of  silver,  without  the  advantage  of  coinage 


53 


and  merely  as  bullion,  will  also  buy  fonr-fifths  of  a  bushel  of  wheat — 
the  only  difference  between  the  figures  for  the  two  years  being  that 
at  the  present  time  412^  grains  of  silver  bullion,  as  will  be  seen  by  the 
table,  will  buy  a  fraction  of  a  bushel  more  than  would  412^  grains  of 
coined  silver  in  1873. 

If,  then,  silver  has  fallen,  it  is  manifestly  not.  in  its  relation  to  wheat. 

By  the  same  table  it  is  shown  that  the  silver  dollar  of  1873,  con- 
taining 412^  grains  of  silver,  nine-tenths  fine,  would  purchase  one 
and  eight-tenths  bushels  of  corn  ;  in  1890,  a  like  number  of  grains  of 
silver,  uncoined  and  estimated  at  its  gold  value,  will  purchase  one 
and  nine-tenths  bushels  of  corn.  Here  again  the  advantage  is 
slightly  in  favor  of  the  412^  grains  of  silver  bullion  of  1890.  This 
shows  conclusively  that  silver  has  not  fallen  in  its  relation  to  corn. 

The  figures  of  the  same  table  show  that  in  1873  a  coined  silver  dol- 
lar of  412£  grains  would  buy  5£  pounds  of  cotton ;  to-day  412£  grains 
of  uncoined  silver  will  buy  6f  pounds  of  cotton.  From  this  it  ap- 
pears that  silver  has  not  fallen  relatively  to  cotton,  the  great  staple 
of  universal  use,  but  that,  ou  the  contrary,  it  has  advanced  some- 
what in  its  purchasing  power  when  compared  with  that  article. 

In  order  to  present  the  question  from  another  point  of  view  I  sub- 
mit another  table  showing  the  number  of  grains  of  silver  that  are 
required  in  1890  and  the  number  which  were  required  in  1873  to  buy 
a  bushel  of  wheat,  a  bushel  of  corn,  &c.,  by  which  it  will  even  more 
clearly  appear  that  silver  has  not  fallen  in  value  in  respect  to  com- 
modities. 

Comparative  purchasing  power  of  silver  bullion,  in  grains  nine-tenths 
fine,  in  1873  and  1890,  respectively. 


Articles. 

1873. 
Legal  tender. 

1890. 
Commodity. 

Wheat  

Qraing  silver. 
474.3 

Grains  silver. 
468 

do  

223.9 

209.25 

Cotton  

.......  per  pound.. 

77.55 

61.42 

Beef,  iness  

pt-r  barrel.. 

8,  662.  5 

7,560 

Pork,  mess  .. 

..do.  

5,  465.  62 

6,750 

Lard  

.  ..  .......  ........per  pound. 

31.97 

35.1 

Butter  

do  

76.31 

89.1 

Cheese  

do.... 

47.44 

59.4 

Sugar,  refined. 

do  

,              42.  07 

39.82 

Eggs  

per  dozen  .  . 

96.52 

76.68 

From  this  table  it  will  be  seen  that  in  1873  it  required  474  grains 
of  standard  silver,  in  the  form  of  coined  dollars,  to  buy  one  bushel 
of  wheat ;  in  1890,  only  468  grains  of  standard  silver  (and  that  merely 
in  bullion  form,  or  in  other  words,  at  its  market  value)  are  required 
to  buy  a  bushel  of  wheat.  This  does  not  show  that  silver  has  fallen 
in  value,  in  its  relation  to  wheat,  but,  on  the  contrary,  that  it  haa 
risen  in  value. 

In  1873  it  required  224  grains  of  silver  to  buy  a  bushel  of  corn ; 
to-day  only  209  grains  of  silver  are  required  to  buy  the  same  quan- 
tity. These  figures  fail  to  prove  that  silver  has  fallen  in  value,  in 
its  relation  to  corn.  On  the  contrary,  again,  it  has  risen. 

In  1873  a  pound  of  cotton  could  not  be  had  for  less  than  77£  grains 
of  silver;  to-day  the  same  pound  of  cotton  can  be  bought  for  61 


54 

grains  of  silver.    Silver,  therefore,  has  not  fallen,  bat  risen  in  value 
in  ita  relation  to  cotton. 

In  1873  96  grains  of  silver  were  required  to  buy  one  dozen  eggs; 
to-day  only  76  grains  of  silver  are  required  to  buy  the  same-quant  ity 
of  eggs.  Silver  therefore  has  not  fallen  bat  risen  in  value,  in  its  re- 
lation to  eggs. 

These  comparisons  might  be  continued  with  the  same  results  as  to 
a  great  majority  of  the  articles  entering  into  general  use. 

These  figures  demonstrate  that  in  its  relation  to  all  commodities 
that  enter  into  the  daily  consumption,  silver  lias  uot  fallen  in 
value,  but,  as  is  clearly  seen,  while  holding  a  remarkably  steady 
ratio  to  commodities,  has  slightly  increased  in  value,  as  is  shown 
by  the  fact  that  a  less  number  of  grains  of  the  metal  are  to-day 
required  to  purchase  the  same  quantity  of  the  commodities 
tioned  than  were  required  in  1873. 

In  relation  to  what,  then,  is  it  that  silver  has  fallen  T  As  it  has 
not  fallen  in  relation  to  commodities,  there  remains  but  one  thiiu; 
in  relation  to  which  it  can  be  said  to  have  tall.-n,  ami  that  one  thing 
is  gold.  The  phrase  "the  fall  ot  silver"  is  the  ingenious  and  cun- 
ning invention  by  which  it  is  sought  to  cast  on  that  metal  the  dis- 
credit of  depreciation  rather  than  subject  gold  to  the  suspicion  of 
any  change  whatever.  The  term  to  correctly  describe  what  has 
taken  place  would  be  "  the  rise  of  gold;"  but  that  term  is  scrupu- 
lously avoided,  as  implying  that  gold  does  not  remain  immovably 
fixed.  That  gold  has  risen,  however,  admits  of  no  doubt,  except  to 
those  who  willfully  shut  their  eyes  to  facts  of  common  observation, 
ue  test  of  the  increasing  or  decreasing  value  of  any  one  thing 
is  not  to  compare  it  with  any  other  one  thing,  but  with  a  large  range 
of  commodities  generally  dealt  in.  It  i>  not  of. so  much  important-t- 
ic know  how  much  gold  cau  be  bought  with  a  given  amount  of  sil- 
ver, as  it  is  to  know  how  much  bread,  how  much  meat,  and  how 
much  clothing  cau  be  bought,  and  how  much  of  all  the  things  that 
*>re  neoewtary  to  the  comfort  and  well-being  of  the  people  can  be 
bought  with  that  amount  of  silver. 

PKOOP  THAT  GOLD   HAS  K1HF.R. 

In  ord«-r  t<>  demonstrate  that  gold  has  ri.-i-n,  I  will  bring  side  by 
side  the  gold   prices  of  a  number  of  leading  commo<liiics  of  com- 
merce :  -tl  1889,  respectively,  ami  the  amount  in  .silver  bull- 
ion that  in  1889  would  purchase  an  equal  quant  ity  of  i  he  .-an 
modi  ties,  by  a  table  prepared  at  my  request  by  the  Uureuu  ol  E 
tics  of  the  Treasury  Department. 


55 


Average  export  prices  of  the  following  named  domestic  commodities  for  the 
years  ending  June  30, 1873  and  1889. 


Commodities. 

Unit  of 
quantity. 

Average  price  of  the  year  ending 
June  30  — 

1873. 

1889. 

In 
currency. 

In 
gold. 

In 
gold. 

In 
silver 
bullion. 

Bacon  and  hams  

Pounds., 
do 

$0.  088 
.211 
.130 
.617 

.188 

.166 
.162 

5.480 
2.498 
4.114 
.092 
.253 
.071 

.092 
.116 
1.312 
7.565 

$0.  077 
.184 
.113 
.539 

.164 

.145 
.142 

4.781 
2.181 
3.592 
.080 
.221 
.062 

.080 
.101 
1.145 
6.604 

$0.084 
,166 
.092 
.508 

.099 

.065 
.068 

3.183 
.953 
2.169 
.076 
.185 
.055 

.056 
.066 
.874 
4.703 

$0.  108 
.212 
.118 
.650 

.127 

.083 
.087 

4,074 
1.220 
2.776 
.097 
.237 
.070 

.072 
.084 
1.119 
6.020 

Butter                ............... 

do 

Bushels.. 
Pounds  .  . 

Yards  .. 
do    

Cotton  : 
Unmanufactured,  not  sea  Is- 
land. 
Cloth  colored    

Cloth   uncolured  ..........  

Iron  and  steel: 

Cwt     ... 

do 

Railroad-bars  

do  

Lard             
Leather  

Pounds  .. 
...do  

do     . 

Sugar  : 
Brown  ....................... 

Pounds  .  . 
do  

Refined  

"Wheat  

Bushels.. 
Barrels  .. 

Wheat-flour  

What  does  an  examination  of  this  table  snow  ? 
dispute  that  gold  has  risen  in  value. 


It  shows  beyond 


K3£TUUV      UUOrU     ^\'J-VA     i_lM,O     &AWU     XU       V  CMUV« 

A  bushel  of  wheat  that,  according  to  the  figures  of  the  Bureau  of  I 
Statistics  cost  $  1.14  in  gold  or  silver  in  1873,  and  which,  as  will  be   V 
seen  by  the  table,  still  commands  $1.12  in  silver  bullion,  will  to-day 
bring  only  87  cents  in  gold. 

A  pound  of  cotton  that  in  1873  cost  the  purchaser,  in  gold  or  silver, 
16  cents,  and  which  still  commands  13  cents  in  silver  bullion,  will 
bring  only  10  cents  in  gold. 

A  pound  of  cheese  that  in  1873  cost  the  purchaser  ]  1 $•  cents  in 
gold  or  silver,  and  which  now  brings  12  cents  in  silver  bullion,  will 
briug  only  9  cents  in  gold. 

A  barrel  of  flour  which  in  1873  cost  the  purchaser  $6.60  in  gold  or 
silver,  and  which  to-day  commands  $6.02  in  silver  bullion,  will  bring 
but  $4.70  in  gold. 

A  pound  of  butter  that  in  1873  brought  18.4  cents  in  gold  or  silver, 
and  now  commands  20.8  cents  iu  silver  bullion,  will  bring  but  16.6 
cents  in  gold. 

Notwithstanding  that  412^  grains  of  uncoined  silver  will  to-day  buy 
as  much  of  the  leading  articles  of  commerce  as  the  coined  gold  dollar 
would  buy  in  1873,  yet  the  advocates  of  the  gold  standard  characterize 
it  as  a  72-cent  dollar.  Then  the  gold  dollar  of  1873  was  a72-cent  dollar. 
If  the  gold  dollar  of  to-day  be  an  honest  and  equitable  dollar,  that  of 
1873,  which  was  worth  much  less,  was  a  swindling  and  dishonest  one ; 
and  if  gold  continues  to  advance  as  it  has  been  advancing,  and  with 
the  declining  output  of  that  metal  there  is  no  reason  why  it  should 


56 

not,  it  will  1)«  bnt  a  abort  time  before  any  other  kind  of  dollar  whose 
value  may  be  equal  to  that  of  the  present  gold  dollar  will  be  .stig- 
matized as  a  swindling  7'J-cent  dollar.  Then-  never  was  a  dollar 
coined  that  did  not  legally  and  practically  contain  100  cents.  But 
the  creditors  stigmatize  a' dollar  of  the  value  of  the  gold  and  silver 
dollar  of  1873  as  a  7'J -cent  dollar.  May  not  the  debtors,  with  much 
more  propriety,  denounce  the  gold  dollar  of  to-day  as  a  140-cent 
dollar  f 

According  to  the  admissions  of  the  royal  commission  of  England, 
the  gold  dollar  of  to-day  is  to  the  producers  of  this  country,  measuied 
by  their  product*,  already  at  a  premium  of  between  3d  and  -in  per  cent, 
over  the  gold  dollar  of  is::i.  The  advocates  of  the  gold  standard  have 
no  sympathy  with  our  farmers  and  manufacturers  \vh<»  have  to  pav.  in 
commodities,  a  premium  of  30  to  40  per  cent,  on  gold,  to  meet  tl  • 
gagements,  but  express  extreme  anxiety  at  the  bare  possibility  that  a 
few  importers  might  have  to  pay  even  a  small  premium  in  any  form. 
They  insist  that  the  money  system  of  a  population  of  65.000,000,  shall, 
like  an  inverted  pyramid,  be  made  to  rest  upon  its  apex  in  order  to  en- 
able a  few  importers,  most  of  whom  are  residents  of  foreign  countries, 
to  make  their  payments  abroad  in  gold. 

!y,  Mr.  President,  the  single  gold  standard  is  an  expensive 
luxury  for  our  people  to  maintain. 

Those  who  deride  silver  as  a  money-metal  indulge  in  feeble  attempts 
at  sarcasm  by  inquiring  why  we  do  not  advocate  the  use  of  tin  and 
brass  as  money.  They  speak  and  write  as  though  the  idea  of  using 
silver  as  money  were  a  recent  discovery  or  invention  of  people  en- 
gaged in  silver  mining.  They  also  ignore  the  fact  that  the  standard 
silver  dollar  of  the  United  States,  which,  with  much  satisfaction,  they 
. ;  ize  as  a  7'J-cent  dollar,  ret]  u  ires  a  gold  dollar  to  obtain  it.  It 
ift  \\  orth  a  gold  dollar  in  London,  in  Berlin,  in  Vienna,  in  Saint  1 
burg,  in  Madrid,  in  Havana,  and  in  all  countries  having  commercial 
relations  with  the  United  States.  It  can  at  one,-  be  exchanged  into 
the  money  of  any  country  with  only  the  slight  deduction  of  cost  of 
shipment  to  this  country — as  is  the  case  in  the  1'nited  States  with 
notes  of  the  Bank  of  England,  which  are  redeemable  in  gold. 

Onr  silver  dollar  is  not  money  in  foreign  countries — and  it  is  to  our 
advantage  that  it  is  not — for  were  it  money  anywhere  else  than  in 
this  country,  we  could  not  rely  on  its  remaining  here  to  maintain  that 
!!»•(«  of  prices  indispensable  to  pro-pi-ny.  But  if  any  of  our 
silver  dollars  are  found  abroad,  let  no  one  suppose  he  can  get  them 
by  tendering41v.'i  grains  of  silver  bullion  for  each  dollar.  He  \\  ill  find 
it  will  .out  him  precisely  as  much  gold  as  it  passes  for  in  the  l"nit< •<! 

Stain, 

80MB  KrraCTa  OF  THE  RISK  OF  OOI.D. 

If  a  cotton  planter  in  1873  owed  $10,000  he  could  then  have  paid  it 
with  r.n.'.C.".  jmiinds  i,f  i-otton.     To,;  •t'tlie   inc. 

command  which  gold  has  over  commodities  it  would  take  lul.ulO 
pound*  of  cotton  to  pay  that  $10,(H)»>;  notwithstanding  that  the 
money  in  which  the  debtor  h.i-  paid  the  in:  . come 

I  .tillable  than  it  wan  at  the  tune  lie  com  rat-ted  to  pav  it. 

The  cotton  manufacturer  «>f   the   l'.a-t   \\!M.  in   1-7:!  owed  $10,000 
could  then  have  naid  it  with  7'    •  red  cotton  cloth; 

to-day  owing  to  tin-  riHcin  tin-  value'  t.f  gold  it  would  require  1  . 

.'  debt,  wil  hot:-  •  ..nut  theamoiint  lost 

by  the  dcb'or  in  the  greater  sacri tie.-  he  had  \  ear  by  year  to  make  to 

farmer  of  the  North  and  West  who  in  1*73  owed  $10,000  could 


57 

then  have  paid  it  with  8,733  bushels  of  wheat;  to-day  it  would  require 
11,446  bushels  of  wheat  to  liquidate  that  debt,  though  he,  too,  has 
year  by  year  been  "  cinched  "  through  the  progressive  increase  in  the 
value  of  the  money  in  which  the  interest  has  been  paid.  Or  he  could, 
in  1873,  have  paid  bis  debt  with  1,514  barrels  of  flour;  to-day  it  would 
take  2,126  barrels  of  flour  to  pay  the  same  debt. 

The  property  of  the  country  is  fast  passing  into  the  hands  of  the 
creditors,  and  if  the  iniquitous  system  is  not  reversed  the  condition 
of  our  American  farmers  will  be  that  of  the  farmers  of  gold-stand- 
ard countries.  Instead  of  owning  their  farms  they  will  be  tenants 
and  rent-payers — a  condition  but  little  in  advance  of  that  which 
prevailed  in  feudal  days. 

Machiavelli,  describing  a  turbulent  period  in  the  history  of  Flor- 
ence, said: 

The  people  perished,  but  the  brigands  throve. 

The  brigandage  of  the  Middle  Ages,  whether  in  Italy  or  elsewhere, 
was  a  criminal  defiance  of  law,  but  it  was  pursued  at  some  risk,  and 
under  manifest  disadvantages.  The  brigand  took  his  life  in  his  hands. 
He  knew  that  his  calling  was  unlawful ;  and,  although  ruthless  in  his 
work,  the  method  by  which  he  exacted  ransom  of  his  occasional  vic- 
tim was  less  destructive  to  the  prosperity  of  the  community  than 
the  legalized  brigandage  of  to-day  by  which,  through  a  vicious  sys- 
tem of  money,  the  great  mass  of  the  people  are  despoiled  of  their 
property.  The  distinguishing  characteristic  of  the  brigandage  of 
the  nineteenth  century  is  that  it  scrupulously  observes  all  legal 
forms,  and  is  conducted  in  the  name  of  honor,  honesty,  good  morals 
and  "  sound  finance."  Mortgages  are  foreclosed  only  in  accordance 
with  law,  and  the  unearned  increment  which  results  from  the  in- 
creased and  increasing  value  of  the  money  is  transferred  from  the 
debtor  to  the  creditor,  with  punctilious  regard  for  the  statutes. 

The  demands  of  the  brigand  were  enforced  with  guns  and  pistols  ; 
those  of  the  creditor  are  enforced  with  bonds  and  mortgages ;  both 
exactions  cruel  and  unjust,  one  by  violence,  the  other  by  law.  But, 
in  the  latter  case,  so  indirect  is  the  method  of  operation  that  many 
of  those  who  are  benefited  by  it  are  unaware  of  the  perpetration  of 
any  wrong.  So  subtle  is  the  process  that  the  change  seems  to  be 
only  a  change  in  the  price  of  commodities,  and  thousands  of  men 
who  would  scorn  consciously  to  exact  from  any  one  more  than  a 
just  return  for  money  loaned  are  beneficiaries  of  this  vicious  and 
ruinous  system. 

With  regard  to  the  great  body  of  the  working  masses  it  is  some- 
times said  they  have  no  cause  for  complaint,  that  their  condition  now 
is  better  than  ever  before. 

But,  Mr.  President,  it  is  not  enough  that  men  are  better  off  than 
they  have  been.  When  we  reflect  that  nine-tenths  of  the  inventions 
and  improvements  constituting  all  the  material  features  of  the  civ- 
ilization of  this  century  have  been  made  by  working  men,  it  is  man- 
ifest that  they  are  entitled  to  much  more  of  the  comforts  and  conven- 
ience of  life  than  are  now  accessible  to  them.  By  watchful,  re- 
peated, and  aggressive  efforts  through  their  trade  organizations,  the 
workinginen  in  many  branches  have  been  enabled  to  keep  wages  from 
sinking,  and  occasionally  to  secure  an  advance;  but,  during  a  period 
of  falling  prices,  what  is  gained  in  this  way  by  those  who  are  kept 
at  work  is  lost  to  the  working  class  as  a  whole  by  the  remission  to 
idleness  of  part  of  their  number. 

The  statisticians  who  seem  to  be  employed  by  some  propaganda  to 


58 

prove  by  figures  that  prosperity  prevails,  point  exultantly  to  the 
fact  that  the  wages  of  the  working  people  seem  constantly  to  have 
increased  while  prices  are  falling,  and  they  cite  this  to  prove  that 
low  prices  are  consistent  with  prosperity.  They  leave  entirely  out 
of  the  account  the  large  numbers  of  workmen  who  of  necessity  are 
relegated  to  idleness  on  account  of  the  lack  of  profit  in  business. 

If  you  go  into  the  workshops  of  any  large  manufacturing  enter- 
prise, while  prices  are  low  and  lowering,  and  ask  the  managers  wbat 
they  now  do  when  a  strike  occurs  among  the  workmen,  they  will  tell 
yon  they  find  it  impossible  to  shut  down,  because  they  have  contracts 
extending  through  time  that  they  must  fill,  but,  they  add,  "  We  pay 
the  wages  demanded  and  we  reduce  the  nnmber  of  the  employed." 

If  there  are  a  thousand  workmen  employed,  getting  $2  each  per 
day,  that  would  be  a  wage  fund  of  $2,000  a  day.  If,  when  prices 
fall  and  business  becomes  dull,  the  employers  should  want  to  reduce 
tii.-  pay  of  each  workman  to  $1.50  a  day,  and  if  the  workmen,  by 
striking,  should  prevent  that  decrease,  and  if,  then,  25  per  cent.  <if 
their  nnmber  should  be  discharged,  the  loss  to  the  working  class,  as 
a  body,  and  to  the  community  at  large,  wonld  be  the  same  as  though 
the  wages  were  reduced  to  $1.50  a  day.  Until  these  people  who  pre- 
sent statistics  can  show  us  how  many  laborers  are  left  out  of  employ- 
ment there  is  no  possibility  of  urn  v ing  at  any  correct  conclusion  as  to 
what  the  wage  fund  is  and  how  much  wages  are  paid. 

The  loss  to  society  is  much  greater  when  25  per  cent,  of  the  people 
are  unemployed  than  if  all  continued  at  work  upon  a  25  per  cent,  re- 
duction of  wages,  because  the  relegation  to  idleness  of  25  per  ri-n; . 
of  the  workmen  reduces  the  producing  force,  and  lessens  correspond- 
ingly the  aggregate  aunnal  production. 

TEX  ITTKKUT  or  THE  MIXIXO  STATES  ix  THE  RKMOKETIZATIOX  OP  SILVER. 
Those  who  in  the  Senate  and  in  the  other  House  of  Congress,  rep- 
resent mining  constituencies  are  taunted  with  the  selfish  purpose 
of  advancing  the  interests  of  their  own  States  at  the  expense  of  those 
of  the  country.  It  is  sought  to  discredit  the  State  \\  Inch  1  have  the 
honor  in  part  to  represent  on  this  floor,  on  the  ground  that  the  people, 
being  largely  silver  miners,  have  a  personal  interest  in  the  reinoneti- 
zation  of  silver. 

The  silver  miners,  Mr.  President,  need  no  defense  here  or  elsewhere. 
They  have  asked  no  fuvors  from  the  Government,  and  aak  none  now. 
They  are  bold,  adventurous,  ami  self-reliant  men,  who  have  wan- 
dered across  alkaline  deserts,  and  over  paihh---  mountain*,  hraved 
the  assaults  ot  h»Mil.-  -.1. .._:.•-.  the  miasma  of  the  I-thum*  and  the 
storms  of  the  Cape,  and  have  planted  the  Hag  of  a  high  <M\  ih/ation 
<in  the  western  confines  of  this  Republic.  No  more  patriotic  or  piih- 
-pirited  class  of  citizens  can  be  found  within  thr  border*  of  the 
Union.  Their  business  is  an  honorable  one.  When  they  entered 
upon  it  tiit-y,  in  common  with  other  nti/ens.  Imd  the  uairant  ot 
«•,  ami  thn  authority  of  all  writers  and  thinkers  on  political  ec.mo- 
my,  for  the  Iwlief  that  silver  was,  and  would  ever  be,  a  money  metal, 
eut  ill  credit  which  from  time  immemorial  had  been 

accorded  t<>  n.  Silver,  equally  with  gold,  had  been  consecrated  by 
all  the  ages  t<>  tip  money  use,  and  was  dedicated  to  such  use  by  the 

:  the  I  nited  States. 

n  the  Constitution  declared  that  Congress  should  have  i> 
"  to  cola  money  and  regulate  the  value  thereof  "  ami  that  "  no  State 
1  shall   '  I  and  silver  coin  a  tender  in  paj- 

1  mentof  debts,"  it  warrant.-,!  the  h.  •]>.<  I  on  th<-  p.-.tt  of  .-ill  who  adopted 
j  the  calling  mud  undertook  the  business  of  mining,  that  «old  an 

J..M    • 


59 

would  continue  to  be  money  metals  in  the  sense  in  which  they  had 
been  for  thousands  of  years  in  the  past.  The  silver  miners  were  war- 
ranted in  presuming  that  when  the  Constitution  esteemed  so  highly 
the  legal-tender  function  in  the  two  metals,  gold  and  silver,  as  that 
it  prohibited  the  States  from  making  anything  a  legal  tender  except 
coin  of  those  two  metals,  it  would  not  warrant  the  Congress  of  the 
United  States  in  taking  from  one  of  those  metals  the  power  of  legal 
tender  and  conferring  that  imperial  function  exclusively  on  the  other. 
Silver  mining  is  a  business  requiring  for  its  successful  prosecution 
skill,  experience,  and  energy,  while  nine-tenths  of  the  gold  of  the 
world  has  come  from  placers;  requiring  neither  organization,  capi- 
ital,  nor  skilled  labor. 

The  production  of  gold  is  much  more  a  matter  of  accident  and  much 
more  liable  to  fluctuation  than  is  the  case  with  silver.  The  silver 
miners  therefore  had  a  right  to  believe  that  so  long  as  23.22  grains  of 
pure  gold  should  be  entitled  to  recognition  as  one  dollar,  371.25  grains 
of  pure  silver  would  continue  to  be  entitled  to  like  recognition  as  one 
dollar,  and  would  possess  the  legal-tender  function  as  such,  for  the 
liquidation  of  all  debts,  public  and  private.  On  the  strength  of  this 
warranty  of  the  Constitution,  and  of  the  unbroken  experience  of  the 
ages,  large  sums  of  money  were  invested  in  mining  property  and  in 
the  employment  of  labor  to  develop  the  mines  of  the  country.  On  the 
strength  of  this  belief  and  conviction,  shared  in  by  all  the  people  of 
the  United  States,  that  gold  and  silver  would  both  remain  the  money 
metals  of  the  world,  debts  to  an  enormous  extent  were  incurred,  and 
it  was  confidently  believed  that  both  metals  would  for  all  time  be 
available  for  the  pavment  of  those  debts. 

The  silver-miners  had  learned  from  the  history  of  mining,  as  well  as 
from  hard  and  bitter  experience,  that  the  mines  might  at  any  moment 
cease  to  yield,  in  which  case  their  occupation  would  be  gone  and  the 
capital  invested  would  be  a  total  loss.  But  they  did  not  suppose  that 
the  verdict  of  all  time  would  be  reversed,  or  that  the  implied  warranty 
of  the  Constitution  of  the  United  States  would  be  disregarded.  They 
did  not  believe  that  either  one  of  the  money  metals  would  ever  be 
demonetized.  And  if  a  doubt  had  entered  their  minds  on  that  sub- 
ject, they  would  naturally  suppose  that  gold  rather  than  silver  would 
be  demonetized,  gold  being  too  limited  in  quantity  to  answer  alone 
the  purposes  of  money  in  a  rapidly  advancing  civilization;  its  yield 
being  uncertain  and  capricious  and  the  prospect  of  a  continued  and 
sufficient  supply  becoming  less  from  year  to  year. 

But,  Mr.  President,  the  degree  of  special  interest  which  the  min- 
ing States  have  in  this  measure  is  not  to  be  compared  with  that  of 
the  other  States  of  the  Union. 

According  to  the  report  of  the  Director  of  the  Mint,  the  total  quan- 
tity of  silver  produced  in  the  United  States  in  the  eleven  years  from 
1878  to  1888  inclusive  was  41)6,210,0/0  tine  ounces.  According  to  the 
same  authority  the  commercial  value  of  that  silver  was  $436,260, 000, 
and  the  coinage  value  $525,145,000.  A  very  simple  process  of  arith- 
metic shows  that  the  difference  between  the  commercial  and  the 
coinage  value  of  that  silver  was  $88,885,000,  oran  average  of  $8,080,544 
each  year.  Assuming  that  amount  to  have  been  the  annual  differ- 
ence between  the  coinage  and  commercial  value  of  silver  for  the  five 
years  preceding  1878,  we  must  add  to  the  $38,885,000  the  sum  of 
$40,402,220,  making  a  total  of  $129,287,220  as  the  amount  which  the 
silver  miners,  not  of  Nevada  but  of  the  whole  United  States  in  the 
seventeen  years  ending  1889,  lost  by  the  demonetization  of  silver. 

Having  thus  demonstrated  in  dollars  and  cents  the  degree  of  self- 


60 

ishness  which,  as  is  charged,  is  the  motive  of  the  miners  in  advocating 
the  remonetization  of  silver,  let  us  glance  at  the  degree  of  selfishness 
which  may  be  said  to  impel  other  classes  of  the  community  to  advo- 
cate the  same  can-o. 

THR  IMT*KE8T  OF  TUB  XON-MIXIXG  STATES  UC   RKMOXKT1ZATIO5. 

The  price  of  cotton  for  the  year  1873,  in  gold  or  silver  (then  of 
equal  power),  was  16.4  cents  per  pound.  The  price  in  18rD  was  <>.'.» 
cento. 

The  yield  of  cotton  for  Iridl)  was  7,000,000  bales,  or  3,500,000,000 
pounds. 

Had  not  silver  been  demonetised  that  cotton  would  have  brought 
as  good  a  price  to-day  as  it  did  in  1873.     At  the  price  of  1-?:!  the  ac- 
count would  have  nt'u  '100,000  pounds,  at   16.4  cents. 
000.000.    At  the  pt:,euil--.i  the  account  stands  3.."i()H.ini  ..oon  pounds. 
at  9.9  cents,  $345,50<>,i)iM),  showing  a  loss  in  debt-paying  and  ta 

ver  on  cotton  alone  (only  one  article  of  merchandised  in  the 
i-^on  of  the  fall  in  prices  caused  by  the  demoneti- 
/at'i.m'of  silver,  Of  $937,500,000. 

Having  shown  that  the  Ions  to  the  silver  miners  by  the  discount 
on  silver  for  the  seventeen  years  from  1-7:5  to  H-ty  was  less  than 
'.nun.  it  will  be  seen  that  the  loss  in  one  single  year  to  the 
cotton  planters  of  the  United  States  is  greater  by  $90,000,000  than 
the  total  loss  for  the  entire  seventeen  years  to  the  silver  miners  of 
the  cuiintry. 

Hut  inasmuch  as  the  cotton  crop  of  1889  was  exceptionally  large, 
I  will,  for  the  purpose  of  my  computation,  discard  it.  and  assume 
i  that  an  average  yield  for  the  year>  between  1873  and  1889 
would  be  5,000,000  hales  per  annum— which  is  a  fair  average  and  by 
no  treans  high—  .">, 000,000  hales,  of  500  pounds  each,  are  equal  to 
2,500,000,000  pounds. 

At  the  pr  the  result  of  each  year  would  be  2,500,000,000 

I,  at  !•;  J  cents,  $410,000,000. 

•:-d  ing  to  the  figures  gi\  en  by  the  l?iircau  of  Statistics  theaver- 

coeived  each  year  of  *the  seventeen  was  1:5.1  cents  per 

pound:  2,600,000,000  pounds,  al  i:?.i  rents  per  pound,  equal  $387,000.- 

..wing  a  difference  of  $83,000,000;  that  being  the  avera- 
separate  year  for  seventeen  .total  sum  tor  the  entire  period 

of  $1,411,000,000,  which  represents  the  loss  in  debt-  and  tax-  paying 
power  suffered  by  the  cotton  planters  by  reason  of  the  demo? 
turn  uf  Hilver. 

This  is  the  enormous  tribute  which  has  been  exacted  of  the  0 
industry  of  this  country  in    behalf  of  the  gold    "standard."  and  of 
thoee  who,  for  their  own    pecuniary  advantage,  cunnmglv  induced 

M  gre»  Of  the  United   States  to  demon  et  i/e  si  I  ,  is  t  lie 

mini  \\  Inch  the  planters  of  this  country  have  lust  m  dcht-pa\  i; 

\ing  power  by  that    mad   act    of  tolly.     As  will   !>• 

R-  u  loos  vastly  in  excess  uf  that  su  tiered  by  the  silver  8 
i  the  discount  on  the  price  uf  silver  bullion. 

i   the  silver  miners  are  taunted  with  having  a  p.  : 

.  ceK*uf   the    movement     for  the  full     remoliell/atlon 

ot   silver,  the  cotton    planter   must    be  placed    in   thesai •ategui\, 

• 

A  like  computation  with  \vhcat  \\uishu  dcbt- 

:  nut  less  than  -  ear  to 

>y  reason  of  the  <l<>muueti/ation 

•     of  $1,700,000,000  iii  tin-  article  of  wheat  alone  in 

•Mm 


61 

Thus  a  loss,  wholly  unnecessary,  of  more  than  $3,000,000,000  in 
debt-paying  and  tax-paying  power  is  shown  to  have  been  inflicted 
on  the  farmers  and  cotton  planters  of  this  country. 

In  comparison  with  this  enormous  loss  to  farmers  and  planters, 
how  paltry  is  the  loss  of  $8,000,000  a  year  suffered  by  the  silver 
miners. 

But,  however  large  the  direct  loss  to  the  debtors  and  to  the  coun- 
try by  reason  of  falling  prices,  the  losses  that  are  indirect  are  of  in- 
finitely greater  magnitude,  and  stand  out  like  a  great  mountain  of 
wrong  superimposed  upon  the  most  deserving  class  in  the  commu- 
nity, whose  interests  it  should  be  the  paramount  duty  of  Govern- 
ment to  protect,  a  wrong  more  calamitous  in  its  consequences  than 
any  of  the  multitudinous  wrongs  which  a  shrinking  volume  of  money 
inflicts  upon  society. 

THE  ENORMOUS  LOSS  OF  POTENTIAL,  WKALTH  THROUGH  INVOLUNTARY  IDLENESS. 

The  political  economist,  Mr.  President,  deals  with  property  in  esse, 
and  producers  employed.  I  propose  for  a  moment  to  deal  with  prop- 
erty in  posse  and  producers  unemployed.  The  wealth  which  the  po- 
litical economist  discusses  is  realized  wealth  ;  that  to  which  I  now 
briefly  invite  your  serious  consideration  is  the  wealth  that  might 
be,  and  would  be,  brought  into  existence  were  the  energies  of  all 
the  people  utilized.  For,  while  it  has  attracted  but  little  attention^ 
from  writers  on  economic  science,  it  will  be  found  upon  examination 
that  the  non-employment  of  its  members  is  incomparably  the  greatest 
loss  which  an  increase  in  the  value  of  money  and  the  consequent  dis- 
organization of  industry  inflicts  on  society. 

The  great  writers  and  thinkers  on  economic  subjects  discuss  with 
care  the  elements  that  enter  into  the  production  and  distribution  of 
wealth.  They  follow  in  detail  the  manufactured  article  through 
all  its  stages,  from  the  crude  material  to  the  finished  product ;  and, 
when  completed,  they  conduct  it  through  the  intricate  channels  by 
which  it  reaches  the  hands  of  the  consumer.  The  greatest  considera- 
tion is  bestowed  upon  the  labor  employed  and  the  wealth  resulting 
therefrom,  but  scarcely  any  thought  is  given  to  the  immeasurable 
mass  of  potential  wealth  not  produced,  but  lying  latent  in  the  brains 
and  hands  of  the  millions  who  are  condemned  to  involuntary  idle- 
ness. 

While  no  mere  sum  in  arithmetic  can  represent  the  enormous  loss 
suffered  by  a  nation  through  this  cause,  let  us  see  whether  we  can 
arrive  by  figures  at  an  approximate  conception,  at  least,  of  the  loss  of 
wages  which  it  entails  upon  the  working  masses,  and  the  corre- 
sponding loss  of  wealth  to  the  country. 

The  most  thorough  and  painstaking  investigation  into  the  condi- 
tions of  labor  in  this  country  has  been  that  which  for  many  years 
has  been  conducted  by  the  Massachusetts  Bureau  of  Labor.  Its  work 
has  been  universally  admitted  to  be  free  from  bias,  and  devoid  of  all 
attempt  to  establish  any  special  hobby,  or  to  force,  by  figures,  the 
proof  of  any  preconceived  theory. 

SOME   STATISTICS   OF   THE   UNEMPLOYED. 

An  examination  of  the  work  of  that  bureau  shows  that,  in  1837, 
there  were  816,470  persons  engaged  in  wage  earning  in  the  State  of 
Massachusetts.  Of  those,  241,589,  or  nearly  30  per  cent.,  were  idle 
during  some  part  of  the  year — ranging  from  one  to  six  or  more 
months.  The  average  of  their  unemployed  time  was  about  four 
months,  or  one-third  of  the  year. 

Now,  240,000  people  idle  for  one- third  of  their  whole  time  is  equiv- 
alent, in  money  loss,  to  the  total  idleness  of  one-third  of  that  num- 


62 

her,  or  80,000  people,  for  the  entire  year.  The  whole  number  of 
persons  enrolled  for  labor  in  the  State  being  816,470,  tlii>  is  equiv- 
alent  to  the  total  idleness  of  one-tenth  of  the  people  engaged  in  all 
occupations. 

If  a  number  equivalent  to  one-tenth  of  the  people  in  all  occupa- 
tions are  idle  twelve  months  in  the  year  in  a  State  like  Massachu.set ;  -, 
where  labor  is  better  organ!  zed,  better  classified,  and  more  etliciently 
ordered  than  elsewhere  in  this  country,  it  can  not  he  presumed  that 
any  other  State  of  the  Union  will  exhibit  a  smaller  proportion  of 
unemployed  laborers. 

The  Census  Report  of  1880  states  the  number  of  persons  em] 
in  all  occupations  as  17,392,099,  out  of  a  population  of  50, 1 .".:..: 
•  percentage  of  34.68  of  the  entire  population.    Our  present  popula- 
tion being  not  leas  than  65,000,000,  if  \\  •  assume,  as  we  are  warranted 
in  doing,  that  alike  proportion  of  the  population  is  engaged  in  occu- 
pations of  all  s<>rts.  it  is  clear  that  we  have  to-day  a  workii 
ulation  of  ^J,-2r>4,000  persons. 

Accepting  as  correct  the  careful  deductions  from  the  Reports  of 
the  Massachusetts  Bureau  of  Labor  that  a  number  equivalent  to  t<  n 
percent,  of  the  people  are  always  out  of  employment  we  find  that  at 
the  present  time  there  are  2, 250,000  penona  in  voluntarily  idle  in  this 
country.  How  faintly  does  the  term  "the  army  of  the  unemployed" 
describe  this  vast  number  of  eager  and  willing  men  seeking  in  vain 
:-portumty  to  earn  a  livelihood  tor  themselves  and  families. 

\Vere  the  business  of  the  country  in  the  active  condition  in  which 
it  could  not  avoid  being  if  our  money  system  were  perfectly  ad- 
i  to  industry,  and  if  employers  were  competing  for  laborers 
with  the  same  degree  of  eagerness  that  laborers  are  competing  for 
employment,  the  average  wage  of  a  day  for  a  working  man  would 
not  be  less  :  I  his  would  make  but  tlie  moderate  sum  of  $50  a 

month  for  each  \\orkman.  which,  under  the  most  thritty  system  of 

iiold  economy,  can  not  lie  considered  more   than  euon. 
the  support  of  an  Anier:r:m  family. 

WAGE    L<»-    I -K..M     I.NVOIA-NTAKY    1M.KXE88. 

By  multiplying  the  number  of  persons  thus  shown  to  be  idle,  by 

this  moderate  average  wage,  we  arrive  at  the  amount  of  $4,500,000 

a«  the  daily  sum  which  is    .-t   t<>  the  wage  earners  of  the  1'mtcd 

by  the  non-vmploym.-nt  of  labor.     This  is  a  money  loss  of 

$-J7,000,000  a  week,  $117,000,000  a  month,  or  the  ama/ing  sum  of 

•|>00,000  a  year.     Asav  ;i^  of  this  MIIU   for  a  year  and   three 

months  would  pay  our  entire  national  debt.     This  being  the  '. 

'.••  year,  we  can  imagine  (making  due  allowance  l\.r  dinVrenee 
numbers  of  the  i>opi.  •ipemlous  has  been  tl 

to  the  nation  during  the  past  sevent.  .a  loss  exceeding  in- 

irably  all  \  <-r. 

•  •at  !•••  loii.  it  IN  appropriately  noted  as  a  pu  I.I: 
a  city  be  burned  down. 

propri  -,mpathie> 

of  all  t  lie  t.  iit    in  unstinted  measure  to  tip  But 

here  is  a  loss  an  real  and  a*  deplorable  a^  an>  -.1  by  tlood 

or  flro — a  IOM  whoae  consequence*,  while  not  MO  apparent,  are  as  de- 
an the  biiriiiii.  '  ICH,  or  tin? 

ranee  of  one  hundred  and  fa  disasters  every  year, 

and  always  to  t  lie   |.e»ph-   \\h<>  passes 

almost  wholl\  nnh'-e.le.l 

tr  that  would  taku  a  mil'  i   from  industry  and  de- 

•he  country  of  the  pr<Hltict,nii  \\hu-li  \\ould  re«ull  from  their 

mm 


63 

labors,  would  be  regarded  as  a  calamity  of  unsurpassable  mag- 
nitude, yet  a  shrinkage  iu  the  volume  of  money  relatively  to  pop- 
ulation withdraws  much  more  than  that  number  from  productive 
pursuits,  and  without  the  salutary  discipline  and  restraints  of  mili- 
tary life,  subjects  them  to  conditions  of  which  the  unavoidable  re- 
sults are  poverty  and  crime. 

Imagine,  Mr.  President,  the  unhappiness,  discontent,  and  even  de- 
spair implied  in  the  mere  statement  that  '2,000,000  men  are  constantly 
out  of  employment ;  (or,  what  amounts  to  the  same  thing,  that  three 
times  that  number  are  idle  for  four  months  in  the  year !)  Imagine, 
what  it  means  to  the  working  people  of  this  country  to  be  deprived 
of^the  enormous  sum  of  $1,400,000,000  a  year. 

But,  aside  from  the  effect  on  the  individual,  what  benumbing  con- 
sequences are  entailed  upon  the  nation  by  the  idleness  of  so  large  a 
number  of  its  people.  The  loss  of  the  wealth  which  the  labor  of  those 
men  might  have  created  is  a  loss  never  to  be  retrieved.  When  the 
money  volume  of  a  country  is  sufficient  to  keep  prices  from  falling, 
and  thus  to  encourage  capital  to  seek  productive  enterprises,  in 
which  labor  is  employed,  every  willing  man  is  kept  at  work,  and  no 
country  can  enjoy  any  higher  degree  of  prosperity  than  when  all  its 
people  are  employed,  and  the  products  of  their  labor  equitably  dis- 
tributed. 

Much,  I  believe,  of  the  prejudice  against  silver  money  arises  from 
an  idea,  conscientionsly  entertained,  by  many,  that  gold  money  has 
the  greater  "intrinsic  value."  I  shall,  therefore,  Mr.  President,  at 
the  risk  of  being  a  little  abstruse,  discuss  that  point. 

THE  MEANING  OF  VALUE. 

No  discussion  of  the  subject  of  money  can  be  intelligently  con- 
"  ducted  without  a  correct  conception  of  the  meanings  attaching  to  the 
terms  employed.  For  a  misconception  of  those  meanings  is  the  root 
of  much  of  the  confusion  and  difficulty  by  which  the  subject  is  sur- 
rounded. 

"Value"  is  a  word  which,  of  necessity,  is  more  frequently  used— 
and,  I  will  add,  more  frequently  misused  and  misunderstood — than 
any  other  employed  in  the  discussion  of  economic  science.  Volumes 
have  been  written  upon  it,  and  yet,  from  the  daily  misapplication  of 
the  word  in  leading  magazines  and  newspapers,  it  is  evident  that  its 
meaning  is  very  imperfectly  understood. 

The  idea  involved  in  the  word  "  Value  "  is  so  broad  and  pervasive 
that  within  the  limits  of  a  speech  it  would  be  impossible  to  discuss 
it  in  all  its  bearings.  I  shall  not,  therefore,  at  this  time,  do  more 
than  present  what  I  conceive  to  be  a  basic  definition  of  it. 

Value  is  human  estimation  placed  upon  desirable  objects  whose 
quantity  is  limited,  and  whose  acquisition  involves  sacrifice.  In 
order  that  an  object  may  have  value  it  must  not  only  be  the  subject 
of  human  desire,  but  there  must  bo  a  limitation  of  its  quantity,  and 
its  acquisition  must  demand  a  sacrifice  from  him  who  would  obtain 
it.  The  term  "  intrinsic  value  "  is  used  by  many  writers  with  a  total 
disregard  of  the  idea  involved  in  the  word  value.  An  article  may 
have  estimable  qualities  that  are  intrinsic,  but  no  article  whatever 
can  have  intrinsic  value.  Its  "value"  is  the  mental  estimation  of 
its  qualities,  as  modified  by  the  limitations  of  its  quantity  and  the 
amount  of  sacrifice  necessary  to  obtain  it.  In  other  words,  value  is 
subjective,  not  objective.  In  economic  discussion,  however,  value 
is  treated  as  though  it  resided  in  the  object,  rather  than  in  the  mind, 
and  while,  for  convenience,  I  may  occasionally  use  it  in  that  sense, 
it  is  important  to  bear  in  mind  the  distinction. 


64 

In  that  acceptation,  value  is  usually  divided  into  value-in -use, 
niul  value-in-exchange.  Certain  esteemed  qualities  of  an  oi-i.-ci 
may  make  it  of  great  value-iu-use;  but  unless  its  acquisition  de- 
mand sacrifice,  it  can  have  no  value-in-exchange.  It  is  only  with 
this  class  of  value  that  economists  deal.  No  matter  how  important 
the  intrinsic  qualities  of  any  article  may  be,  if  there  be  no  limitation 
of  its  quantity  and  its  acquisition  requires  no  sacrifice,  it  can  have  n.> 
value  in  the  sense  in  which  the  word  "value"  is  used  in  political 
economy.  The  air  has  qualities  inestimable  to  mankind  ;  it  must  be 
regarded  as  incomparably  the  most  useful  of  all  the  objects  of 
human  desire;  yet  it  has  no  value  because  there  is  no  limitation 
of  its  qu.-uitity."  By  reason  of  its  universality  and  accessibility,  air 
requires  no  sacrifice  to  get  it.  If,  however,  circumstances  should 
render  air  limited  in  qnautity  it  is  conceivable  tliat  it  might  become 
of  surpassing  value.  A  man  confined  in  the  "  Black  Hole"  of  Cal- 
cutta would  give  a  fortune  for  free  access  to  air.  .So  water,  where 
freely  obtainable,  without  sacrifice,  although  indispensable  to  life, 
haa  no  value  in  the  economic  sense — no  value  in  exchange.  But 
when  not  so  obtainable,  a»  in  populous  cities,  where  sacrifice  of  timo 
and  labor  would  be  necessary  to  obtain  it  from  river,  lake,  or  spring, 
people  pay  for  the  convenience  of  having  it  in  their  homes.  Tin-  in- 
-ahle  prerequisites  of  value  in  all  objects  are  utility — either 
actual  or  attributed — combined  with  limitation  of  quantity  and  the 
sacrifice  necessary  to  be  made  in  order  to  obtain  it. 

Hut  value  is  not  a  property  inhering  in  any  article  itself.  It  is  not 
intrinsic.  If  the  value  were  inherent  or  intrinsic  it  could  not  be 
taken  away. 

To  illustrate:  A  generation  ago  the  cradle  with  which  wheat  -A  an 
harvested  was  sui<l  to  posse**  intrinsic  value.  It  was  undoubtedly 
one  of  the  most  useful  of  all  the  articles  needed  by  man.  All  that 
was  then  in  that  machine  is  in  it  still,  yet  the.  value  is  gone,  ll.nl 
the  value  been  something  that  was  intrinsic,  had  it  resided  in  the 
object,  and  not  in  the  mind,  that  cradle  would  still  be  worth  all  that 
it  ever  was.  So,  on  the  other  hand,  an  article  may  possess  moat 
estimable  qualities,  but  if  those  qualities  are  not  known  or  recog- 
nized by  the  human  mind  the  article  will  have  no  value. 

A  few  years  ago  cotton  seed  ha.l  no  value  as  an  article  of  general 
commerce.  To-day  *t  is  exceedingly  valuable,  because  it  has  been 
found  to  possess  estimable  qualities  not  before  suspected. 

Indeed  so  strongly  does  the  idea  of  value  rest  upon  the  estimation 
of  the  mind  that  it  is  not  even  necessary  for  an  article  to  possess  in 
any  desirable  quality  whatever  in  order  to  have  value.     It 
will  be  sufficient  if  such  quality  is  popularly  attributed  to  it.     Num- 
bers of  instances  could  be  cited  in  which  there  was  present  no  ele- 
ment of  value  except  limitation  of  quantity,  added  to  a  mere  belief, 
•.ii  of  the  mind,  that    the  article   had  desirable  qualities. 
Many  will  remember  that  a  few  years  ago  a  herb  called  ••('nmlu- 
rango"  was  introduced   into  this  country  from  Central  Amen, 
was  generally  believed  to  possess  healing  finalities  in  cases  of  can- 
cer, and  so  came  to  have  great  value.     As  soon  as  this  popular  illu- 
vas  dispelled  the  article  ceased  to  have  even  the  slightest 
value. 

Land  being  indestructible  and  irremovable,  is  believed  to  be  the 
embodiment  of  the  idea  of  intrinsic  valne.     Take,  then,  a  lot  on 
Madison  arenoe,  New  York ;  it  is  worth  perhaps  a   thousand  timei 
an  much  an  a  lot  of  equal  size  in  a  village   n-mote   from  th- 
What  proportion  oL  its  high  price  is  ,.tu  what  is  called  its 


65 

greater  "  intrinsic  "  value  ?  A  lot  on  that  fashionable  thoroughfare 
has  no  intrinsic  attribute,  or  quality,  that  is  not  equally  the  attri- 
bute or  quality  of  the  village  lot.  The  difference  in  its  value,  or, 
more  correctly,  the  difference  in  the  estimation  in  which  it  is  held, 
as  compared  with  that  attaching  to  the  village  lot,  is  derived  wholly 
from  circumstances  that  are  extrinsic,  not  from  qualities  that  are 
intrinsic. 

The  action  of  society  in  utilizing  land  in  the  neighborhood  of  the 
city^lot  by  building  up  around  itgives  that  lot  a  value  greater  than 
one  of  equal  size  elsewhere. 

But  in  order  that  a  thing  may  subserve  a  useful  or  beneficent  pur- 
pose it  is  not  necessary  that  the  quality  which  enables  it  to  subserve 
that  purpose  should  be  intrinsic  or  iuherent  in  the  thing  itself. 

To  apply  this  reasoning  to  the  subject  under  discussion — whatever 
intrinsic  qualities  the  metal,  gold,  may  possess,  they  confer  no  force 
whatever  on  gold-money. 

WHAT  18  MONEY! 

The  money  of  a  country  is  that  thing,  whatever  it  may  be,  which 
is  commonly  accepted  in  exchange  for  labor  or  property  and  in  pay- 
ment of  debts,  whether  so  accepted  by  force  of  law,  or  by  universal  A 
consent.  Its  value  does  not  arise  from  the  intrinsic  qualities  which 
the  material  of  which  it  is  made  may  possess,  but  depends  entirely 
on  tke  extrinsic  qualities  which  law,  or  general  consent,  may 
confer. 

Money  is  of  transcendent  importance  to  civilization.  It  is  the 
physical  agency  to  which  society  has  assigned  the  function  of  meas- 
uring all  equities,  and  it  is  the  sole  agency  upon  which  that  incom- 
parable function  has  been  conferred.  It  is  in  terms  of  money  that 
society  computes  the  material  value  of  all  human  sacrifice,  alike  the 
highest  effort  of  genius  and  the  daily  toil  and  sweat  of  the  millions 
who  labor. 

In  order  to  measure  equitably  the  natural  and  inevitable  mutations 
in  the  value  of  other  things,  money  should  itself  be  of  unchanging  /  / 
value.     That  is  to  say,  any  given  amount  of  money  should,  so  far  as  \J 
human  foresight  can  regulate  it,  require  at  all  times  an  equal  amount    jNy 
of    sacrifice  for  its  acquisition.     Thus,  in  the  case  of   a   contract 
made  to-day,  requiring  the  payment  of  a  dollar  twelve  months  hence, 
that  dollar  when  due  should  exact  from  the  debtor  precisely  that 
amount  of  sacrifice,  and  no  more,  which  would  be  required  had  he      *"•» 
paid  the  debt  the  day  after  contracting  it. 

No  one  will  deny  that  the  most  important  quality  that  money 
can  possess  is  that  it  shall  truthfully  measure  and  state  equities. 

As  I  have  shown  by  the  figures  heretofore  cited,  gold  has  risen  in        sV 
value  between  30  and  40  per  cent,  since  the  demonetization  of  silver.          f~ 
It  is  not  therefore  so  faithful  a  measure  of  value  as  is  silver,  which 
as  illustrated  by  a  variety  of  examples,  has  maintained  almost  un- 
disturbed its  relation  to  commodities. 

THE  VALUE  OF  MONEY,  AS  SUCH,  NOT  IN  THE  MATERIAL  BUT  IN  THE  STAMP.      MONEY 
18  AN  OBDEE  FOE  PliOPEKTY  AND  SEEVICE8. 

The  logic  of  the  situation,  and  the  reasoning  of  all  the  leading  au- 
thorities on  money,  lead  irresistibly  to  the  conclusion  that  its  value 
does  not  reside  in  the  material,  but  in  the  stamp ;  in  other  words, 
on  the  legal-tender  function  impressed  on  that  material.  It  is  an 
order  for  property  and  services. 


CO 

Aristotle,  writing  of  money,  says  : 

Honey  by  itself  *  *  *  ha*  value  only  by  law,  and  not  by  nature  ;  so  that  a 
change  of  convention  between  those  who  use  ft  la  sufficient  to  deprive  it  of  all  its 
value  and  power  to  satisfy  all  our  wants. 

And  again  he  says  : 

But  with  regard  to  a  future  exchange  (If  we  want  nothing  at  present)  money 
is,  aa  it  were,  our  security  that  it  may  take  place  when  we  do  want  something. 

John  Locke,  In  "Considerations,"  etc.,  regarding  money,  published  in  1691,  says: 
Mankind,  having  covenanted  to  put  an  imaginary  value  upon  gold  and  silver,  by 
reason  of  their  duntbleness  .-carcity,  and  not  ln-iiiii  ver\  liable  to  be  counterfeited, 
have  made  them,  by  general  consent,  the  common  ]>  ledges,  whereby  men  are  as- 
sured, in  exchange  for  them,  to  receive  equally  valuable  things  to  those  they 
parted  with,  for  any  quantity  of  those  metals;  by  which  means  it  comes  to  pass 
that  the  intrinsic  value  regard  in  those  metal?,  made  the  common  barter,  is  noth- 
ing but  the  quantity  which  men  give  or  receive  of  them  :  they  having,  as  money, 
no  other  value  but  aa  pledges  to  procure  what  one  wants  or  desires. 

Bandeau,  reputed  one  of  the  most  eminent  of  an  early  school  of 
French  economists,  says: 

Coined  money  in  circulation  is  nothing,  as  I  have  said  elsewhere,  but  effective 
titles  on  the  general  mass  of  useful  and  agreeable  enjoyment  which  cause  the 


well-being  and  propagation  of  the  bumun  race. 
It  is  a  kind  of  a  bill  of  exc 


change,  or  order  payable  at  the  will  of  the  bearer. 
Adam  Smith  says  : 

A  guinea  may  be  considered  as  a  bill  for  a  certain  quantity  of  necessaries  and 
conveniences  upon  all  the  tradesmen  in  the  neighborhood. 

Jevons's  "  Money  and  Exchanges,"  chapter  8,  says: 

Those  who  use  coins  in  ordinary  business  need  never  inquire  how  much  nn-t.il 
they  contain.  Probably  not  one  person  in  two  tlmu*iuid  in  this  kingdom  know*. 
or  need  know,  that  a  sovereign  should  contain  rj:i.-.'7417  grains  of  standard  gold. 

Money  is  mad<>  to  go.    People  wsut  coin,  not  to  keep  iu  their  own  pock> 
to  pass  It  off  into  their  neighbors'  pockets. 

Henry  Thorn  ton,  in  his  work  on  Paper  Credit,  says: 

Honey  of  every  kind  in  an  order  for  goods.    It  is  so  considered  by  the  laborer, 

when  he  receives  it,  and  it  is  almost  instantly  turned  into  money's  worth      It   :-< 

the  instrument  by  which  the  purchasable  stock  of  the  country  indistnli 

nU-d  with  convenience  and  advantage  among  the  several  members  of  the  commu- 

nity. 

John  Stnart  Mill  says  : 

The  pounds  or  shillings  which  a  person  receives  are  a  sort  of  ticket  or  order 
which  lie  can  present  for  paym<  >1  which  entitle  him 

to  receive  a  certain  value  of  at  lie  wakes  choice. 

McLeod,  Elements  of  Banking,  Chapter  I,  says  : 

When  persons  Uke  a  piece  of  money  in  exchange  for  services,  or  products,  they 
can  neither  eat  it,  nor  drink  it.  nor  clothe  themselves  with  it.  Th-  only  reason 
why  they  Uke  it  is,  because  they  believe  they  can  exchange  it  away  whenever 
they  please  for  other  things  which  they  require. 

On  that  view  of  inom-y  MrLeod  f.  :  in  styling  it  credit, 

aii«l  he  quotes  in  sii]>|>oit  nfmirli  a  UNI-  of  flit-  t.'i  inYrcilit,  Itnrkc's 
description  .if  gold  and  silver  as  "th--  t  raODgniMd  species 

that  represent  the  lasting  conventional  credit  of  mankind." 

Prof.  Francis  A.  Walker,  Money,  Trade,  etc.,  page  25,  speaking 
of  carved  pebbles,  glass  beads,  she  1  Is  and  red  feathers,  used  as  money 
in  certain  countries  at  certain  times,  says: 

They  were  good  money,  though  serving  no  purpose  but  ornament  and  deoo- 
ration.  They  were  desired  by  the  community  in  general  ;  men  would  give  for 

JOMJJ 


67 

them  the  fruits  of  their  labor,  knowing  that  with  them  they  conld  obtain  most 
conveniently  in  time,  in  form,  and  in  amount,  the  fruits  of  the  labor  of  others. ' 

On  page  30  he  says : 

Men  take  money  with  the  expectation  of  parting  with  it;  this  is  the  use  to 
which  they  mean  to  put  it. 

Again,  Mr.  Walker  says : 

Money  is  that  which  passes  freely  from  hand  to  hand  throughout  the  commu- 
nity, in  final  discharge  of  debts  and  fall  payment  for  commodities,  being  accepted 
equally  without  reference  to  the  character  or  credit  of  the  person  who  offers  it, 
and  without  the  intention  of  the  person  who  receives  it  to  consume  it,  or  enjoy  it, 
or  apply  it  to  any  other  use  than,  in  tarn,  to  tender  it  to  others  in  discharge  of 
debts  or  payment  for  commodities. 

Even  Bonaray  Price,  who  is  wedded  to  the  gold  standard,  in  his 
Principles  of  Currency,  says: 

Gold,  in  the  form  of  money  or  coin,  is  not  sought  for  its  own  sake,  as  an  article 
of  consumption.  It  must  never  be  regarded  as  valnable  exofcpt  for  the  work  it 
performs,  so  long  as  it  remains  in  the  state  of  coin.  It  can  be  converted  at  pleas- 
ure into  an  end,  into  an  article  of  consumption,  by  being  sold ;  till  then  it  is  a 
mere  tool. 

How  many  people  ever  so  "  convert "  it  that  earn  it? 

The  great  philosopher,  Bishop  Berkeley,  one  of  the  most  acute  rea- 
soners,  in  my  judgment,  that  modern  times  have  produced,  in  the 
"  Querist,"  published  in  1710,  propounds  the  following  pertinent  and 
suggestive  questions : 

"Whether  the  terms  "  crown,"  "livre,"  "pound  sterling,"  etc.,  are  not  to  be  con- 
sidered as  exponents,  or  denominations  1  And  whether  gold,  silver,  and  paper  are 
not  tickets  or  counters  for  reckoning,  recording,  or  transferring  such  denomina- 
tionB  1  "Whether,  the  denominations  being  retained,  although  the  bullion  were 
gone,  things  might  not  nevertheless  be  rated,  bought,  and  sold,  industry  promoted 
and  a  circulation  of  commerce  obtained? 

Dugald  Stewart,  professor  of  moral  philosophy  in  the  University 
of  Edinburgh,  in  his  Lectures  on  Political  Economy  (Part  I,  Book 
II),  said : 

"When  gold  is  converted  into  coin,  its  possessor  never  thinks  of  anything  but  its 
exchangeable  value,  or  supposes  a  coffer  of  guineas  to  be  more  valuable  because 
they  are  capable  of  being  transferred  into  a  service  of  plate  for  his  own  use. 
"Why  then  should  we  suppose  that,  if  the  intrinsic  value  of  gold  and  silver  were 
completely  annihilated,  they  might  not  still  perform,  as  well  as  now.  all  the  func- 
tions of  money,  supposing  them  to  retain  all  those  recommendations  (durability, 
divisibility,  etc.)  formerly  stated,  which  give  them  so  decided  a  superiority  over 
everything  else  which  could  be  employed  for  the  same  purpose. 
•  Supposing  the  supply  of  the  precious  metals  at  present  afforded  by  the  mines  to 
fail  entirely  the  world  over,  there  can  be  little  doubt  that  all  the  plate  i.ow  in  ex- 
istence would  be  gradually  converted  into  money,  and  gold  and  silver  would  soon 
cease  to  be  employed  in  the  ornamental  arts.  In  this  case  a  few  years  would 
obliterate  entirely  all  trace  of  the  intrinsic  value  of  these  metals,  while  their  value 
would  be  understood  to  arise  from  those  characteristical  qualities  (divisibility, 
durability,  etc.)  which  recommend  them  as  media  of  exchange.  I  see  no  reason 
why  gold  and  silver  should  not  have  maintained  their  value  as  money,  if  they  had 
been  applicable  to  no  other  purposes  than  to  serve  as  money.  I  am  therefore  dis- 
posed to  think,  with  Bishop  Berkeley,  whether  the  true  idea  of  money,  as  such,  be 
not  altogether  that  of  a  ticket  or  counter. 

Appleton's  Cyclopedia,  defining  money,  says : 

Anything  which  freely  circulates  from  hand  to  hand,  as  a  common  acceptable 
medium  of  exchange  in  any  country,  is  in  such  country  money,  even  though  it 
ceases  to  be  such,  or  to  possess  any  value  in  passing  into  another  country.  In  a 
word,  an  article  is  determined  to  be  money  by  reason  of  the  performance  by  it  of 
certain  functions,  without  regard  to  its  form  or  substance. 
JONES 


68 

BABTIAT  8  DE8CKIIT1OK  OF  THE  CROWX   1'IKCR. 

Bastiat,  in  bis  ••  Harmonies  Ecououiiques,"  describing  money,  usep 
the  following  illustration: 

Ton  hare  a  crown  piece.  What  does  it  mean  in  yunr  hands  f  If  you  can  read 
with  the  eye  of  tin-  wind  the  inscription  it  bears,  you  can  distinctly  ••">«  these 
words:  Par  to  the  bearer  a  sorvicc  equivalent  t.i  th.it  which  he  has  rendered  to 
society,  value  received  and  stated,  proved  and  measured  by  that  which  is  on 
me. 

No  words  could  more  correctly  describe  the  unit  in  a  properly 
regulated  system  of  money.  And  notwithstanding  the  attempt  to 
discredit  silver  coinage,  no  pieceof  money,  as  I  have  already  shown. 
would  better  answer,  by  its  steadiness  of  value,  this  descrip; 
Ba&tiat's  than  would  the  American  silver  dollar  if  silver  were  re- 
moneti/<-d. 

So  far  as  it  applied  to  gold  Baatiat's  description  was  much  nearer 
accuracy  in  his  day  than  it  is  in  ours.  In  his  life-time  the  mints  of 
France  and  of  the  Continent  were  open  for  the  coinage  of  silver 
equally  with  gold,  and  the  money  supply  of  the  world  was  not  r. in- 
stantly narrowing  by  being  limited  to  the  yield  of  a  single  in.-t.il 
whose  annual  output  would  hardly  more  than  meet  the  demand  lor 
the  arts. 

Were  Bastiat  alive  at  this  time  he  wonld  reform  his  description  so 
as  to  make  it  read  as  follows:  '*  You  have  an  American  gold  piece. 
You  have  had  it  boarded  in  a  bank  vault  for  fifteen  years.  What 
does  it  mean  in  your  hands  f  If  you  can  read  with  the  eye  oi  tin- 
mind  the  inscription  it  bears,  you  can  distinctly  .see  these  words: 
'  Pay  to  the  bearer  50  percent,  more  service  than  he  has  rendered  to 
society;  value  not  received  or  stated  on  me,  but  resulting  from  a  run- 
ning manipulation  of  the  law  of  legal  tender,  through  the  inilucnce 
of  the  holders  of  gold  and  of  obligations  payable  therein,  and  as  a 
reward  to  the  bearer  for  having  had  this  money  hid  away  and  for  de- 
priving society  of  its  use  for  seventeen  years.'" 

When  people  are  found  everywhere  working  for  money  and  not 
for  the  things  which  they  really  need,  it  is  clear  that  they  are  \\  oi  k- 
ing  for  money,  not  because  of  the  material  of  which  it  is  composed, 
but  because  it  is  an  order  for  property  which  they  can  at  any  time 
obtain  liy  parting  with  the  money.  To  modify  and  elaborate  Bas- 
tiat's description  of  the  crown  piece,  it  might  he  said  of  the  Money 
Unit  of  the  United  States  under  a  properly  regulated  system  : 

ii  have  a  dollar.  What  does  it  mean  in  your  hands  T  If  \ou 
can  read  with  the  eye  of  the  mind  the  inscription  it  bears,  yon  can 
distinctly  see  these  words:  To  all  to  whom  this  may  come:  Greet- 
ing. This  is  a  dollar — a  unit  of  money — part  of  the  great  in.-tru- 
mentality  created  by  society  to  effect  the  multitudinous  exr! 
of  property  and  services  among  men.  The  amount  of  its  command 
i*  OOUtant,  because  the  increase  in  the  volume  of  money  i>  regu- 
lated by  the  sovereign  authority  <>!  the  nation,  \\itl:  ird  to 
the  increase  of  population  and  demand—  hence  the  value  of  this  unit 
remain*  unchanging  through  time.  It  is  an  order  for  all  pi- 
on  sale,  and  all  nervices  for  hire:  the  proportionate  amount  of  such 
property  and  service  to  which  its  possessor  is  entitled  being  fixed 
by  the  universal  competition  to  get 

OUSHAM'B  LAW. 

Many  persons  foar  an  outflow  of  gold  from  the  operation  of  what 

is  known  M  "Gresham'-  li\\,"  namolv.  that   "Nad  money  will  expel 

good."    Sir  Thomas  Gresham,  a  financier  of  Elizabeth's  time,  stated 


69 

that  if  a  number  of  the  gold  or  silver  coins  of  any  given  denomina- 
tion were  deprived  of  part  of  their  pure  metal,  and  so  made  cheaper 
than  the  remainder,  a  successful  circulation  of  the  coins  thus  de- 
prived would  result  in  the  melting  up  or  exportation  of  the  coins  of 
standard  weight.  Writing  of  this,  Mr.  Jevons  ("Money  and  the 
Mechanism  of  Exchange,"  American  edition,  page  84)  says  : 

Gresham's  remarks  concerning  the  inability  of  good  money  to  drive  out  bad 
only  referred  to  moneys  of  one  kind  of  metal.  *  *  *  The  people,  as  a  general  rule, 
do  not  reject  the  better,  but  pass  from  hand  to  hand  indifferently  the  heavy  and  the 
light  coins,  because  their  only  use  for  the  coin  is  as  a  medium  of  exchange.  It  is 
those  who  are  going  to  melt,  export,  hoard,  or  dissolve  the  coins  of  the  realm,  or 
convert  them  into  jewelry  and  gold  leaf,  who  carefully  select  for  their  purposes 
the  new  heavy  coins — 

and  avoid  the  light  or  abraded  coins. 

There  is,  however,  a  theorem  which  applies  to  all  money,  but 
which  was  recognized  long  before  Gresham's  time — although  it  has 
been  erroneously  called  an  "extension"  of  the  law  or  theorem  of 
Gresham. 

That  theorem  is  this:  If,  in  any  country,  there  are  two  forms  of 
money,  each  of  which  is  a  full  legal  tender,  and  one  of  which  can  be 
obtained  with  less  sacrifice  than  the  other,  the  one  requiring  the  least 
sacrifice  will  be  the  cheaper,  and  if  the  unit  of  that  cheaper  money 
will  perform  in  every  respect  the  same  function  in  the  payment  of 
debts  and  settlement  of  all  obligations  that  can  be  performed  by  the 
dearer  money,  then,  for  obvious  reasons,  the  cheaper  money  will  come 
into  universal  use,  and  the  dearer  money  will  disappear.  But  it 
does  not  follow  that  the  cheaper  money  is  bad  money  nor  the  dearer 
money  good  money. 

The  best  money  is  always  the  money  of  the  contract,  that  is  to  say 
a  money  whose  dollar,  whatever  it  may  be  made  of,  is  equal  in  value 
to  the  dollar  of  the  contract.  If  the  money  of  the  courtract  is  the 
cheapest  money,  then  that  is  the  best  money,  that  is  the  honest 
money,  and  that  is  the  only  tolerable  money. 

If  that  be  the  sort  of  ;<  cheap  "  money  that  drives  out  the  dear 
money,  then  manifestly  the  dear  money  is  bad  money. 

A  distinguished  official  of  the  Government,  who  was  before  a  com- 
mittee of  this  body  the  other  day,  insisted  that  the  proposed  Treasury 
notes  should  be  redeemed  in  the  "best  money."  I  asked  him  what 
was  the  "best  money."  "Why,"  he  said,  "the  money  that  is  worth 
the  most."  Now,  it  strikes  me,  Mr.  President,  that  if  you  have  bor- 
rowed a  dollar,  and,  through  a  badly  regulated  money-system,  are 
made  to  pay  a  dollar  worth  25  per  cent,  more  than  the  dollar  you  bor- 
rowed, you  are  not  paying  the  best  money,  but  the  worst  money;  not 
an  honest  dollar,  but  a  swindling  and  dishonest  dollar. 

THE  CREDITORS'  DEMAND  FOR  THE  "BEST  MONEY." 

The  creditors  tell  us  that  all  they  want  is  "good  money."  They 
and  their  friends  glibly  insist  that  all  obligations  must  be  paid  in 
"the  best  money."  This  is  the  delicate  and  plausible  euphemism  re- 
sorted to  in  order  to  gloss  over  and,  if  possible,  hide  from  the  world 
the  odious  and  repulsive  fact  that  what  the  creditors  always  want 
is  the  dearest  money — the  money  that  costs  the  people  the  mpst  sweat 
and  toil  to  obtain  and  which,  as  time  passes,  grows  dearer  and 
dearer. 

This  cry  for  "the  best  money"  is  at  last  beginning  to  be  recog- 
nized for  what  it  is — the  cunning  device  of  creditors  to  "catch  the 
conscience"  of  the  people  and  play  upon  the  sense  of  fairness  that 
characterizes  the  great  mass  of  mankind.  These  interested  parties 


70 

affect  to  believe  that  gold  is,  by  nature,  the  only  money  metal,  ignor- 
ing the  fact  that  until  silver  was  displaced  by  hostile  legislation  it 
was,  and  for  four  thousand  years  bad  been,  the  principal  money  metal 
of  the  world.  But  they  will  no  longer  be  permitted  to  hide  their  sin- 
ister purpose  under  the  cloak  of  a  demand  for  the  "  bent  money.''  The. 
manses  of  the  people  are  aroused  on  this  subject  and  are  beginning  to 
understand  it. 

According  to  all  fair  canons  of  construction  the  best  money  should 
be  and  is  a  money  of  unchanging  value,  a  money  that  exacts  from 
the  debtor  the  same  amount  of  sacrifice  that  lie  liargained  for,  and 
•which  is  all  that  the  creditor  is  equitably  entitled  to  receive.  In 
other  words,  the  money  of  the  con  tract,  not  a  money  whose  exact  ions 
are  increasing  at  the  rate  of  2  per  cent,  per  annum.  As  MeCnlloch 
says,  debts  being  stated  in  dollars  and  cents,  it  is  not  possible  for  the 
creditor  openly  to  augment  his  debtor's  obligation  by  changing  the 
figures  of  the  debt. 

Hut,  Mr.  President,  while  they  can  not  change  the  figures  of  the 
debt,  they  are  enabled,  by  a  crafty  manipulation  of  the  money- 
volume,  to  do  that  which,  to  the  debtor,  means  the  same  thing;  as 
the  following  story  will  illustrate: 

A  usurer  of  the  coarser  type  had  lent  $10,000  on  a  neighboring 
farm,  tor  which  amount  he  took  the  farmer's  note,  secured  by  a 
mortgage  on  the  property.  He  coveted  the  farm,  and  in  his  anxiety 
to  secure  it  took  his  hanker  into  his  confidence.  He  informed  the 
banker  that  he  wanted  to  get  possession  of  this  farm,  bnt  it  would 
bring  $15,000  under  the  hammer,  and  he  did  not  care  to  pay  so  much 
for  it.  "I  have  a  subtle  chemical,"  said  he,  ••  by  which  1  can  oblit- 
erate from  the  note  and  mortgage  all  trace  of  the  rightful  amount 
($10,000), and  that  done,  I  can  insert  $15,000.  Then,  with  the  gen- 
nine  signatures  on  the  note  and  mortgage  I  can  bring  suit,  and  as 
the  farm  will  not  bring  more  than  the  face  of  Jhe  note,  I  shall  suc- 
ceed to  the  property." 

His  friend,  the  banker,  however,  advised  against  thteoOUMkirhieb 
he  characterized  as  not  only  dishonest,  hut  vulgar,  and  as  subjecting 
the  perpetrator  of  the  net  to  serious  penalties.  ••  Monoty  "  vml  tin- 
banker,  "is  the  best  policy."  "Hut."  he  continued,  "lean  stii: 
plan  by  which  you  may  accomplish  the  same  end  without  running 
counter  to  law,  or  the  views  of  society.  Why  not  join  our  propag- 
anda in  advocacy  of  'honest  money.'  Gold  is  «!••< r. -a-iug  in  quan- 
tity, and  as  the  world  has  been  ransacked  for  it  in  \ain.  it  is  likely 
to  continue  decreasing.  If  we  can  strike  down  the  twin  metal,  sil- 
ver, and  devolve  the  entire  money  function  on  gold,  it  will  doul.li> 
the  purchasing  power  of  money.  Tln-n  the  foreclosure  of  your 
mortgage  will  be  sure  to  take  your  neighbor's  farm,  and  probably 
leave  him  in  your  <li  l  Instead  ol  I.em^  punished  for  this, 

you  will  receive  the  plaudits  of  the  •  •.  '  forth- 

nave  displayed  and  the  firm  stand  you  have  taken  in  favor  of  honest 
money,  and  yon  will  take  high  rank  among  -the  wisest  ami  ui-.-t 
conservative  of  our  financing'  If  your  neighbor  makes  «n\  , 

:  action.  \oii  may  be  able  to  hern  re  his  in.  arc.  -rat  ion  a*  a 
lunatic,  but  if  m>t,  he  will  come  t«  >»•  re  L;  aided  in  the  community  as 
aditbonwt 'crank  '  w  ho  \\i-hes  to  pay  his  delits  in  a  depreciated 
money  ;  for  it  m  the  con- taut  ami  aNsiduou-  care  of  our  nikl  t" 

that  only  tin'  -i.-an-st  money,  that  \\  !  most  difficult  for  the 

h.ini.    t-i  get,  is  honest  money,  and 
the  dearer  it  it>  the  more  imnc.-t  it  in." 

jflm 


71 

ALL  MONEY  SHOULD  BE  LEGAL  TENDER. 

To  be  of  the  fullest  service  to  civilization  whatever  medium  is  used 
to  do  the  work  of  money  should  have  full  money  power;  that  is  to 
say,  it  should  be  a  legal  tender.  It  is  not  sufficient  that  it  will  satisfy 
the  demands  of  the  Government  for  taxes. 

Whatever  is  given  out  by  the  Government  in  payment  for  services 
rendered  (and  there  is  no  other  way  by  which  payments  can  be  made 
from  the  Treasury)  should  carry  with  it  to  him  who  has  rendered 
the  service  and  receives  the  payment,  the  absolute  assurance  that  in 
any  need,  or  in  any  contingency,  it  will  serve  him  as  money.  There 
is  no  other  means  by  which  society  can  be  saved  from  the  effects  of 
panics  and  monetary  crises. 

With  a  watchful  and  intelligent  regulation  of  the  money  volume, 
and  with  the  legal  tender  function  attached  to  everything  that  is  in 
use  as  money,  and  doing  the  money  work,  so  that  it  will  serve  as  a 
universal  solvent,  panics  will  be  impossible.  Under  present  condi- 
tions when  panics  come,  credit  money — money  not  endowed  with 
the  legal-tender  function,  which,  under  ordinary  circumstances,  has 
always  been  accepted,  is  refused,  and  thousands  of  millions  of  dol- 
lars' worth  of  property  have  been  confiscated  by  creditors,  because 
of  the  scarcity  of  legal-tender  money.  As  time  advances  and  the 
method  of  doing  business  on  credit  becomes  more  and  more  extended, 
the  more  palpable  it  becomes  that  society  can  preserve  itself  from 
these  periodical  convulsions  only  by  broadening,  under  proper  regu- 
lation, the  legal-tender  basis  on  which,  in  the  ultimate  analysis,  all 
business  rests. 

MONEY  A  MEASURE  OF  VALUE. 

There  is  nothing  upon  which  the  prosperity  and  happiness  of  a 
people  so  much  depend  as  on  the  integrity  of  their  measure  of  values. 

It  is  universally  admitted  that  alter  the  making  of  a  contract  re- 
quiring future  delivery  of  a  specified  number  of  pounds,  bushels,  or 
yards  of  any  commodity,  it  would  be  subversive  of  all  equity  and 
justice  to  change  the  capacity  of  the  measure  constituting  the  founda- 
tion of  the  contract.  These  measures,  to  be  just,  must  remain  un- 
changed. But  how  infinitely  more  important  is  it  that  money,  which 
is  the  measurer  of  all  other  measures,  should  itself  be  unchanged  ? 
Of  what  avail  is  it  that  the  subordinate  measures  remain  intact 
while  this,  the  supreme  measure,  into  which  all  others  are  finally  re- 
solved, is  constantly  changing  ?  Its  "  value  "  is  but  another  name 
for  its  purchasing  or  measuring  power.  In  the  case  of  all  time  con- 
tracts, therefore,  any  change  in  the  value  of  money  works  a  destruc- 
tion of  equity,  and  one  of  the  first  objects  of  society  should  be  to 
maintain  and  enforce  equities  at  all  times  and  in  all  places.  This, 
so  far  as  money  can  effect  it,  can  only  be  done  by  an  intelligent  regu- 
lation of  the  volume  in  circulation. 

In  a  note  to  his  edition  of  Adam  Smith's  "Wealth  of  Nations," 
(page  502)  Mr.  J.  R.  McCulloch  says : 

Money  is  not  a  mere  commodity,  it  is  also  the  standard  or  the  measure  by  which 
to  estimate  and  compare  the  value  of  everything  else  that  is  bought  and  sold,  and 
if  it  be,  as  it  undoubtedly  is,  the  duty  of  G-overnment  to  adopt  every  practicable 
means  for  rendering  all  foot-rules  of  the  same  length,  and  ail  bushels  of  the  same 
capacity,  it  is  still  more  incumbent  upon  it  to  omit  notbiug  that  may  serve  to 
render  money,  or  the  measure  of  value — a  measure  which  is  undoubtedly  of  the 
greatest  importance — uniform  or  steady  in  its  value. 

Though  a  measure  of  value,  money  is  a  much  more  complicated 
instrument  than  a  yard-stick,  pound  weight,  or  bushel.  Were  it 
not  so,  a  child  could  fix  value  with  the  same  precision  as  an  adult. 


As  value  resides  inhuman  estimation,  it  will  frequently  vary  as 
to  the  same  object.  An  intending  purchaser  may  have  one  notion 
of  the  value  of  an  article,  an  intending  seller  another.  Money, 
therefore,  is  a  measure  «>f  value  in  the  sense  that  it  is  a  meav 
the  average  huniun  judgment — from  which  results  price.  As  Mr. 
McCulloch  says,  no  means  known  to  science  or  art  should  be  left  un- 
tried to  keep  the  value  of  money  unchanging. 

When  a  man  promises  to  deliver  money  or  makes  any  time  con 
lie  makes  a  mental  calculation  us  to  what  amount  of  property,  or  of 
the  product  of  his  labor,  will  enable  him  to  meet  his  engagement. 
If  he  be  a  farmer,  raising  wheat,  there  pa--. -s  through  his  mind  the 
Kicrihce  and  toil  necessary  to  raise  it,  and  the  quantity  he  can  raise; 
if  a  cotton  manufacturer  the  cost  of  spindles,  of  looms,  and  steam- 
engines;  the  wages  of  labor  and  inter,  st  on  plant. 

1  knew  a  cotton  manufacturer  who  wanted  $10,00(\     His  business 

was  good.     He  was  sober,  honest,  and  industrious;  had  a  thorough 

.edge  of  his  trade;  managed  his  employe's  himself,  and  took 

•  pains  to  conduct  his  business  on  the  strictest  br. 
principles.  He  wanted  the  money  to  make  some  improvements  in 
his  factory.  lie  knew  how  many  spindles  and  looms  he  had;  how 
much  could  be  done  with  a  pound  of  cotton,  how  much  it  co>t,  and 
how  much  each  spindle  and  loom  would  do.  He  said  to  a  capitalist, 
'•I  know  all  about  cotton  spinning  and  weaving,  and  do  not  know 
anything  about  this  thing  called  money,  but  I  want  $10,000  of  it." 
San!  he,  ••  My  cloth  is  worth  ID  cent*  a  yard  ;  it  sells  at  that  i 
unlimited  quantit ies  by  wholesale  ;  n.-lmdy  can  make  it  any  cheaper; 
but  I  am  not  working  a  gold  mine  ;  1  am  not  manufacturing  legal- 
tender  paper  money,  and  the,  only  way  1  can  get  money  is  to  swap 

•ton  cloth  for  it.     I  will  give  \ou  n  100,000  ya- 

rot  ton  cloth,  which  will  be  equal  to  §10,000,  and  will  pay 'J  inches  a 

each  year  a-  interest." 

This  was  -<.ili-.la.tniy  to  the  capitalist,  and  the  note  was  made, 
signed,  and  delivered  accordingly,  and  the  improvements  were  made 
i:i  the  factory. 

l>uring  the  year  every  thing  went  smoothly;  the  npindlesand  looms 
worked  well,  repair-*  to  machinery  \\ere  Ii^'ht:  cotton  had  Keen 

i  rates;  and  no  improx  ed  pioeesses  had  been  «. 
or  applied  in  tin-  production  of  cotton-cloth.     There  was  no 
.  in  any  diieetimi. 

At  the  appointed  lime,  the  creditor  called  for  his  cloth.     "lam 

.1  tin-  delitot,  "  t«.  pay  the  him  'red  thousand  yards  ..f  •  <>t- 

"th.  with  interest."     When  lie  came  to  measure  it  olV,  however, 

be  was  astounded  to  fm.l  he  was  short.     Some,  painful   suspicion* 

crowed  his  mind,    it  teemed  M  though  lomebodj  had  either  robbed 

him  of  cloth,  or  else  he  had  no;  Mired  as  much  of  it  as  be 

•pp..-.  il.     There  did  not  seem  to  be  so  many  yards  of  the  cloth 

•  re  ougiit  to  be.     He  knew  he  had  lined  the  same   numliei   of 

pound*  of  cotton  that  it  hud  i.een  liiscnstom  to  nee  far  100,000  yard* 

of  cloth  and  for  200,000  inches  of  cloth  in  addition  ;  still,  there  was 

:.ying  tin-  fact  of  the  shoi: 

He  DMM  .11.  and  hail  tinally  to  admit  that  he 

was  unable  to  keep  his  engagement.     This  was  a  source  of 
diatrees  to  him.     He  could  not  sleep  that    ni-ht.      Hut.  the  creditor 
being  Importunate,  the  cotton  manufacturer  next  morning  borrow  ed 
enough  clot  li  from  tl  .  :i  neighboring  factory  and  paid 

cation.     I'.nt.  not  n:  rig  how  his  carefully  made  plans 

had  failed,  and  in  order  to  avoid  similar  mistakes  in  the  future,  be 
MM 


73 

had  an  examination  made  of  the  yard-stick  and  found  that  instead 
of  being  36  inches  long  the  yard-stick  he  had  used  was  40  inches. 

In  talking  the  matter  over  with  his  neighbor,  the  cotton  manu- 
facturer said :  "  I  have  been  swindled  ;  they  "rung  in'  on  me  a  length- 
ened yard-stick,  by  the  measurement  of  which  I  have  paid  my  debt, 
and  I  have  therefore  paid  in  reality  more  than  I  contracted  to  pay." 

"  Well,  "  said  the  friend,  "  I  do  not  see  that  you  are  any  worse  off 
than  I  am.  I  borrowed  as  much  as  you  did,  and  at  the  same  time ; 
but  I  agreed  to  pay  my  debt  in  money,  and  gave  my  note  for  $10,000 
with  interest.  The  increased  command  over  cloth  acquired  by  the 
dollars  I  have  had  to  pay,  caused  by  the  demonetization  of  silver, 
has  juggled  me  out  of  as  much  cloth  as  you  have  been  juggled  out 
of  by  the  lengthened  yard-stick.  But  you  have  one  recourse;  you 
can  put  into  the  penitentiary  the  man  who  '  rung  in'  the  lengthened 
yard-stick  on  you,  while  the  increase  in  the  value  of  the  dollar  which 
I  have  paid  has  been  effected  in  the  name  of  the  gold  standard  and 
honest  money,  and  leaves  me  without  recourse.  " 

In  its  ultimate  analysis,  money  is  the  yard-stick,  the  bushel  and 
the  pound  weight  of  commerce. 

When  you  shrink  the  volume  of  money,  and  so  increase  the  meas- 
uring power  of  the  dollar,  you  lengthen  the  yard-stick,  enlarge  the 
specific  gravity  of  the  pound  and  the  cubical  content  of  the  bushel, 
in  violation  of  all  equities. 

It  is  utterly  impossible  to  secure  a  proper  regulation  of  the  money 
volume  with  gold  alone,  the  yield  of  which  has  declined  from  an 
average  of  $130,000,000  a  year  between  1851  and  1873  to  $105,000,000 
a  year  between  1873  and  1889. 

THE  VALUE  OF  MONEY  FIXED  BT  THE  COMPETITION  TO  GET  IT, 

Everbody  admits  that  the  value  of  all  other  things  is  regulated  by 
the  play  against  each  other  of  the  forces  of  supply  and  demand.  No 
reason  has  been  or  can  be  given  why  the  value  of  the  unit  of  money 
is  not  subject  to  this  law. 

WHAT  IS  THE  DEMAND  FOB  MONEY? 

The  demand  for  money  is  equivalent  to  the  sum  of  the  demands 
for  all  other  things  whatsoever,  for  it  is  through  a  demand  first  made 
on  money  that  all  the  wants  of  man  are  satisfied.  The  demand  for 
money  is  instant,  constant,  and  unceasing  and  is  always  at  a  maxi- 
mum. If  any  man  wants  a  pair  of  shoes,  or  a  suit  of  clothes,  he  does 
not  make  his  demand  first  on  the  shoemaker,  or  clothier.  No  man 
except  a  beggar  makes  a  demand  directly  for  food,  clothes,  or  any 
other  article.  Whether  it  be  to  obtain  clothing,  food,  or  shelter — 
whether  the  simplest  necessity  or  the  greatest  luxury  of  life — it  is  on 
money  that  the  demand  is  first  made.  As  this  rule  operates  through- 
out the  entire  range  of  commodities  it  is  manifest  that  the  demand  for 
money  equals  at  least  the  united  demands  for  all  other  things. 

While  population  remains  stationary,  the  demand  for  money  will 
remain  the  same.  As  the  demand  for  one  article  becomes  less,  the 
demand  for  some  other  which  shall  take  its  place  becomes  greater. 
The  demand  for  money  therefore  must  ever  be  as  pressing  and  urgent 
as  the  needs  of  man  are  varied,  incessant,  and  importunate. 

WHAT  IS  TIIE  SUPPLY  OF  MONEY? 

Such  being  the  demand  for  money,  what  is  the  supply  T  It  is  the 
total  number  of  units  of  money  in  circulation  (actual  or  potential) 
in  any  country. 

The  force  of  the  demand  for  money  operating  against  the  supply 


74 

is  represented  by  the  earnest,  incessant  struggle  to  obtain  it.  All 
HUM),  in  all  trades  and  occupations,  are  offering  either  property  or 
services  tor  money.  Each  shoemaker  in  each  locality  is  in  com- 
pel it  ion  with  every  other  shoemaker  in  the  same  locality,  each  hatter 
is  in  competition  with  every  other  hatter,  each  clothier  with  cvi-ry 
other  clothier,  all  offering  their  wares  for  units  of  money.  In  this 
universal  and  perpetual  competition  for  money,  that  number  of 
shoemakers  that  can  supply  the  demand  for  shoes  at  the  smallest 
„•••  price  (excellence  of  quality  being  taken  into  account)  will 
fix  the  market  value  of  shoes  m  money  ;  and  conversely,  will  fix  the 
value  of  money  in  shoes.  So  with  the  hatters  as  to  huts,  so  with  the 
tailors  as  to  clothes,  and  so  with  those  engaged  in  all  other  occupa- 
tions as  to  the  products  respectively  of  their  labor. 

HO  ALTERNATIVE  FOB  MOXKT. 

The  transcendant  importance  of  money,  and  the  constant  pressure 
of  the  demand  for  it  may  be  realized  by  comparing  its  utility  with 
that  of  any  other  force  that  contributes  to  human  welfare. 

In  all  the  broad  range  of  articles  that,  in  a  state  of  civilization, 
are  needed  by  man,  the  only  absolutely  indispensable  thing  is  money. 
For  everything  else  there  is  some  substitute — some  alternative;  for 
money  there  is  none.  Among  articles  or  food,  if  beef  rise  in  price, 
the  demand  for  it  will  diminish,  as  a  certain  proportion  of  the  people 
will  resort  to  other  forms  of  food.  If,  by  reason  of  its  con  tinned  scar- 
city, beef  continue  to  rise,  the  demand  will  further  diminish,  until 
finally  it  may  altogether  cease  and  center  on  something  eh*!.  So  iu 
the  mutter ot  clothing.  If  anyone  fabric  become  scarce,  and  conse- 
quently dear,  the  demand  will  diminish,  and,  if  the  price  continue 
rising,  it  is  only  a  question  ot  time  for  the  demand  to  cease  and  be 

rred  to  some  alternative. 

Hut  this  can  not  be  the  case  with  money.  It  can  never  be  driven 
out  of  use.  There  is  not,  and  there  never  can  be,  any  substitute  for 
11 .  It  may  become  so  scarce  that  one  dollar  at  the  end  of  u  decade 
may  buy  ten  times  as  much  as  ;i:  the  beginning;  that  is  to  say,  it 
may  cost  in  labor  or  eommoditie*  ten  times  as  much  to  gi-t  it,  but  at 
whatever  cost,  tin-  people  must  have  it.  Without  money  the  de- 
mands of  civili/.ation  could  not  be  supplied. 

.Money  was  the  most  potent  instrumentality  in  the  evolution  of 
society  from  a  low  to  a  high  plane  of  civili/ation.     It  is  valueless 
to  man  in  isolation.     It  is  indispensable  to  man  in  organized  so- 
ciety.   It  is  as  necessary  for  the  proprietary  distribution  of  wealth 
M  railroads  and  st.-am-.inp.  are  to  Us  physical  distribution.     The 
aggregate  force  of  tin-   demand   for  money  in  any  country  depends 
i  he   numbers    of  the    population;    with   a  stationary   popula- 
te demand   is  steady,  with  an   int-n-.-i^ni-.,'  population  the  de- 
mand increases,  and  in  ord>  r  to  maintain  undi-tuihi  d  the  equation 
of  supply  and  demand  the  volume  of  money  should  In-  incrr.-ised  in 
at  least  a  ratio  corresponding  to  that  of  tin-  increase  of  population. 
:e    ate    certain    eir.-umstances    that    to    s-.me    extent    disturb 
the  relation*  between  population  and   mon.->    supply,  such  as   the 
broadening  of  the  areas  ot    population,  and   tin-    multipliration  of 
money  centers.    These  circumstances  might  i.  n.i.-i  n.-ei-*-;u  \  a  larger 

tag«  of  increase  in  the  money  volume  than  would  1» 
cat«d  by  the  increase  of  tin  population. 

i'!.-M    money-increase    that 

will  suffice  t<>  maintain  tin- equity  of  time  <  outtt*ot«  is  an  increase 
corresponding  to  the  increase  of  numbers  of 
MOB 

9 


75 

Under  conditions  of  unvarying  demand  and  unvarying  supply 
the  value  of  the  unit  of  money  would  be  unvarying.  If  as  population 
and  demand  increase  the  supply  of  money  be  proportionately  in- 
creased, there  is  no  possibility  of  a  change  in  the  value  of  the  unit 
of  money. 

The  constant  and  unceasing  effort  to  exchange  services  and  all 
forms  of  property,  which  have  but  limited  command  over  the  objects 
of  human  desire,  for  money,  that  sole  instrumentality  that  has  un- 
limited command  over  such  objects,  is,  and  ever  will  be,  eager,  intense, 
and  unwavering. 

With  population  and  consequent  demand  rapidly  increasing  how 
do  the  advocates  of  the  gold  standard  expect  to  increase  the  money 
volume  of  the  country  in  this  proportion,  while  the  yield  of  gold,  in- 
stead of  increasing  in  proportion  to  demand,  is  every  day  becoming 
less  and  less  capable  of  meeting  the  requirements  of  the  arts  alone  ? 

THE  QUANTITY  OF  MONEY  IN  CIRCULATION  SHOULD  INCREASE  IN  A  BATIO  NOT  LESS 
THAN  THE  RATIO  OF  INCREASE  OF  POPULATION. 

It  will  be  admitted  that  if  the  population  of  a  country  be  increased 
by  any  given  percentage  there  will  be  a  proportionate  increase  in  the 
demand  for  all  articles  that  supply  human  needs.  If  the  population 
increases  by  3  per  cent.,  there  will  be  needed  3  percent,  more  house- 
room,  3  per  cent,  more  furniture,  3  per  cent,  more  food,  3  per  cent, 
more  of  all  things  that  enter  into  consumption.  These  things  can 
only  be  got  by  a  demand  first  made  on  money.  Then  why  not  3  per 
cent,  more  money? 

The  present  monetary  circulation  of  this  country,  including  gold, 
silver,  and  paper,  is  represented  to  be  $1,700,000,000.  As  our  popu- 
lation doubles  in  thirty  years,  the  rate  of  increase  is  3£  per  cent. 

If  the  money  volume  be  not  increased  by  a  proportion  at  least  as 
great  as  this,  the  true  relation  between  the  supply  of  money  and  the 
demand  for  it  will  not  be  maintained.  The  demand  increasing  as 
the  population  increases,  while  the  supply  either  does  not  increase 
at  all  or  increases  in  a  degree  incommensurate  with  the  demand,  the 
money  volume  shrinks  and  the  purchasing  power  of  the  unit  be- 
comes greater  by  reason  of  the  increased  keenness  of  competition  to 
get  it.  This  is  but  another  mode  of  stating  that  the  prices  of  all 
products  of  human  labor  decline.  Prices  falling,  business  ceases  to 
be  profitable,  stores  and  work-shops  close,  and  men  are  relegated  to 
idleness. 

THE  QUANTITATIVE  THEORY  OP  MONEY — THE  VALUE  OF  EACH  DOLLAR  DEPENDS  ON 
THE  NUMBER  OF. DOLLARS  OUT. 

Thus  by  the  universal  competition  to  get  it  the  value  of  the  dol- 
lar is  made  to  depend  upon  the  number  of  dollars  that  are  out.  This 
is  a  principle  that  lies  at  the  very  foundation  of  the  science  of  money. 
The  law,  stated  broadly,  is  that  the  value  of  each  unit  of  money  in 
any  country  at  any  given  time  depends  on  the  whole  number  of  units 
in  circulation  in  that  country.  The  larger  the  number  of  units  out, 
population  remaining  the  same,  the  less  must  be  the  value  of  each 
unit ;  the  smaller  the  number  of  units  out,  population  remaining 
the  same,  the  greater  the  value  of  each. 

Notwithstanding  the  variance  sometimes  found  between  the  prem- 
ises and  the  conclusions  of  economic  writers,  there  is  no  economist 
of  repute  who  does  not  admit  this  to  be  a  fundamental  principle. 

On  the  theory  I  have  propounded  therefore  3J-  per  cent,  of 
$1,700,000,000,  or  $56,000,000,  is  the  minimum  amount  of  money  that 
should  be  added  to  the  currency  of  this  country  during  the  present 
year. 


7C 

Assuming  the  population  of  to-day  to  bo  65,000,000  and  the  ratio 

:niii:il  increase  :ty  percent.,  the  population  of  next  year  will 

be  67,166,600.     The  percentage  of  monetary  increase  to  be  provided 

lor  that  year  should  therefore  be  baaed  on  the  increased  number. 

And  soon  for  each  succeeding  year. 

I  have  thought  best  to  collate  a  variety  of  citations  from  the  most 
distinguished  authorities  on  financial  economy  to  support  my  con- 
tention that,  ••'  hris paribus,  the  value  of  each  dollar  depends  on  the 
number  of  dollars  in  circulation. 

John  Locke,  in  his  "Considerations,"  etc.,  published  in  It'.DO,  said: 

Money,  while  the  same  quantity  of  it  is  pausing  up  and  down  the  kingdom  in 
.  •«  really  a  standing  im-asurc  of  tin-  falling  and  rinin<:  value  ot  other  things 
in  reference  to  out-  another,  and  the  alteration  in  )>i  ic.-  if  triilv  in  them  only.     I'.ut 
it'  Mm  increase  or  le«Mfii  the  quantity  of  money  current  iu  tiatlie  in  any  pl.i 
the  alteration  of  value  U  in  the  money. 

Locke  further  said : 

The  value  of  money  in  any  on*  conntry,  is  the  present  quantity  of  the  current 
money  In  that  country,  in  proportion  to  the  present  trade. 

The  historian,  Hume,  says: 

It  is  not  difficult  to  perceive  that  it  is  the  total  quantity  of  the  money  in   circu- 
lation, in  any  country,  which  determines  what  portion  of  that  quantity  .shall  ex- 
Mr  *  ci-rtain  portion  of"  the  goods  or  com  modi:  i.-s  of  t  hat  country. 
. .e  proportion  lict\ve«  n  the  circulating  money  aiid  the  commodities  in  the 
market  which  determines  the  price. 

lite  says: 

The  amount  of  money  cnrrent  in  a  stata  represents  overythinz  that   is    pur- 

:•  on  the  surface  of  the  state.     If  the  quantity  of  purchanali' 

creases  while  the  quantity  of  money  n  mains  the  name,  the  value  of  the  money 
increase!*  in  the  same  ratio  ;  if  the  quant  ity  of  money  mereasi-H.  while  the  quantity 
••mains  tlie  same,  the  value  of  money  decreases  in  the 
•ante  ratio. 

James  Mill,  in  his  treatise  on  political  economy,  says: 

And  again,  in  whatever  degree,  then-fore,  the  quantity  of  money  is  increased  or 
M-d.  other  things  remaining  the  s;uiie.  in  that  same  proportion  tho  value 
whole,  and  of  every  p.u  :  .illy  diminished  or  incteosed. 

John  Stuart  Mill  (Political  Keonomy)  says: 

The  value  of  money,  other  thin::*  being  the  name,  varies  inversely  as  its  qnan- 

i  nig  the  value,  and  every  diminution 
it  in  a  ratio  ••  • 

And  again  : 

Alterations  in  the  cost  of  the  production  of  the  procions  metalsdo  not  net  upon 
the  value  of  money,  except  junt  in  proportion  a.s  they  un- reuse  or  dimini-li  its 
qusn 

•lei  (reply  to  Hos:nn; 

I'ut-  i if  tii'.ney  :n  nuv  country  i»  iletermined  tiy  the  amount  e \mtif 

••r  oportion  to  the  in.  i  e-ise  m  dim- 
..  liw-t  that  in  iucontrovertilikv     •     •     • 

further  nays: 

•  otiev  lint   from  exr<<««:   howc' 
roiling.-  mav  JXM-OII.. 

•  Ain.  jiim  iili  d 
it  be  not  in  too  gr«ai  abnndanoe. 

In  this  caae  Ricnrdn'M  illustration  in  ih.<  snppuseil  cane  of  a  conn  try 
'lion  gold   piece-*  each   containing   1UO  grains. 

.iii.l    lie  of  t  In-  h:iun-   ]iiirchasing  jio.v 

•neni  took  out  1  grain,  or  even  :,(i  grain",  the  (|uantity  re- 
maining the  same,  but  that  if,  from  the  r.\  iucied,  an  uddi- 

JO.SIJI 


77 

tional  number  of  pieces  were  struck,  a  corresponding  depreciation 
would  result. 

William  Huskisson  ("  The  Depreciation  of  the  Currency,"  1819), 
says: 

If  the  quantity  of  gold  in  a  country  whose  currency  consi  sts  of  gold  should  be 
increased  in  any  given  proportion,  the  quantity  of  other  articles  and  the  demand 
for  them  remaining  the  same,  the  value  of  any  given  commodity  measured  in  the 
coin  of  that  country  would  be  increased  in  the  same  proportion. 

Sir  James  Graham  says  : 

The  value  of  money  is  in  the  inverse  ratio  of  its  quantity ;  the  supply  of  com- 
modities remaining  the  same. 

Torrens,  in  his  work  on  Political  Economy,  says: 

Gold  is  a  commodity  governed,  as  all  other  commodities  are  governed,  by  the 
law  of  supply  and  demand.  If  the  value  of  all  other  commodities,  in  relation  to 
gold,  rises  and  falls  as  their  quantities  diminish  or  increase,  the  value  of  gold  in 
relation  to  commodities  must  rise  and  fall  as  its  quantity  is  diminished  or  increased 

Wolowski  says : 

The  sum  total  of  the  precious  metals  is  reckoned  at  50  milliards,  one-half  gold 
and  one-half  silver.  If,  by  a  stroke  of  the  pen,  they  suppress  one  of  these  metals 
in  the  monetary  service,  they  double  the  demand  for  the  other  metal,  to  the  ruin 
of  all  debtors. 

Cernuschi  says : 

The  purchasing  power  of  money  is  in  direct  pro  portion  to  the  volume  of  money 
existing. 

Prof.  Francis  A.   Walker,  in  his  work  on  "Money"  (page  57), 


The  value  of  money  in  any  country  is  determined  by  the  amount  existing. 
Its  [money's]  power  of  acquisition  depends  not  on  its  substance,  but  on  its 
quantity.     [Faulus,  author  of  the  Pandects,  sixth  century.] 

Professor  De  Colange,  in  the  American  Cyclopedia  of  Commerce,  * 

article  on  "Money,"  says: 

The  rate  at  which  money  exchanges  for  other  things  is  determined  by  its  quan- 
tity. *  *  *  St 

supposing  the  amount  of  trade  and  mode  of  circulation  to  remain  stationary,  if 
the  quantity  of  money  be  increased,  its  value  will  fall,  and  the  price  of  other  com- 
modities will  proportionally  rise,  as  the  latter  will  then  exchange  against  a  greater 
amount  of  money ;  if,  on  the  other  hand,  the  quantity  of  money  be  reduced,  its 
value  will  be  raised,  and  prices  in  a  corresponding  degree  diminished,  as  com- 
modities will  then  have  to  be  exchanged  for  a  less  amount  of  money.  *  "  * 

In  whatever  degree,  therefore,  the  quantity  of  money  is  increased  or  diminished, 
other  things  remaining  the  same,  in  that  same  proportion  the  value  of  the  whole 
and  of  every  part  is  reciprocally  diminished  or  increased. 

A  curtailment  of  the  volume  of  money  in  a  country  will,  ceteris 
paribus,  increase  the  value  of  the  money  of  that  country.  All  the 
authorities  agree  that  this  law  applies  to  all  forms  of  money,  what- 
ever the  material ;  so  that  it  applies  to  paper  money  with  precisely 
the  same  force  that  it  applies  to  metallic  money. 

Mr.  Stanley  Jevons,  in  his  work  on  "Money  and  the  Mechanism  of 
Exchange,"  says: 

There  is  plenty  of  evidence  to  prove  that  an  inconvertible  paper  money,  if  care- 
fully limited  in  quantity,  can  retain  its  full  value.  Such  was  the  rase  with  the 
Bank  of  England  notes  for  several  years  after  the  suspension  of  specie  payments 
in  1797,  and  such  is  the  case  with  the  present  notes  of  the  Bank  of  France. 

Mr.  Gallatin  said : 

If  in  a  country  which  wants  and  possesses  a  metallic  currency  of  seventy  mill- 
ions of  dollars,  a  paper  currency  to  the  same  amount  should  be  substituted,  the 
seventy  millions  in  gold  and  silver,  being  no  longer  wanted  for  that  purpose,  will 
be  exported,  and  the  returns  may  be  converted  into  a  productive  capital,  and  add 
an  equal  amount  to  the  wealth  of  the  country. 

JOJfES 


78 

In  his  Proposal  for  an  Economic  and  Secure  Currency  Eicardo 
Bays: 

A  well  regulated  paper  currency  la  so  great  an  improvement  in  commerce,  that 
I  should  greatly  regret  if  prejudice  should  induce  us  to  return  to  a  system  of  less 
utility.  The  introduction  of  the  precious  metals  for  the  purposes  of  money  may 
•with  truth  be  considered  M  one  or  the  most  important  steps  toward  the  inrnovi-- 
nient  of  commerce  and  the  arts  of  civilized  life  ;  but  it  is  no  It-untrue,  that  with  the 
advancement  of  knowledge  and  science,  we  discover  that  it  would  be  another  im- 
provement to  banish  them  again  from  the  employment  to  which,  during  a  leas  en- 
lightened period,  they  had  been  so  advantageously  applied. 

Mr.  J.  R.  McCulloch,  in  commenting  on  the  principles  of  money 
laid  down  by  Ricardo,  says: 

He  examined  the  circumstances  which  determine  the  value  of  money    •    *    • 
ami  he  showed  that    •    •    •     its  value  will  depend  on  the  extent  to  which  it  may 
be  iitsued  compared  with  the  demand.    This  in  a  principle  of  great  im]» 
for.  it  shows  that  intrinsic  worth  is  not  necessary  to  u  currency,  and  that  ; 
the  supply  of  paper  notes,  declared  to  be  a  legal  tender,  be  mitliciently  limited, 
ilue  may  be  maintained  on  a  par  with  the  value  of  gold,  or  rained  to  any 
higher  level.    If,  therefore,  it  were  practicable  to  devise  a  plan  for  preserving  the 
value  of  paper  on  a  level  with  that  of  gold,  without  making  it  convertible  into 
•  he  pleasure  of  the  holder,  the  heavy  expense  of  a  metallic  currency  would 
b«  saved. 

It  appears,  therefore,  that  if  there  were  perfect  security  that  the  power  of 
issuing  paper  money  would  not  be  abused  ;  that  is,  if  there  were  perfect  security 
for  its  being  issued  in  such  <]UHntities,  as  to  preserve  its  value  relatively  to  the 
jnass  of  circulating  commodities  nearly  equal,  the  precious  metals  might  be 
entirely  dispensed  with,  not  only  as  a  circulating  medium,  but  also  aa  a  standard 
to  which  to  refer  the  value  of  paper. 

IB  adopting  a  paper  circulation- 
Says  Lord  Overstone — 

we   must   unavoidably  depend   for  a  maintenance  of  its  due  value  upon  the 
adoption  of  a  strict  and  judicious  rule  for  the  regulation  of  iu  amount. 

Lord  Overatone  further  declared  that : 

The  value  of  the  paper  currency  results  from  its  being  kept  at  the  same  amount 
the  metallic  currency  would  have  been. 

Alexander  Barini;,  in  his  evidence  before  the  secret  committee  of 
tin-  House  of  Lord>  in  1-1H,  said  : 

naper  would  produce  all  those  effects  which  arise  from  the  re 
Auction  in  the  amount  of  money  in  any  country. 

I'rnf.  l-\  A.  Walker  says: 

••  repeat,  money  is  to  be  known  by  Its  doing  a  certain  work.    XL 
not  gold,  though  gold  may  be  money;  somet 

Money  is  no  on.-  thing.  •  many  things  bavingaoy  matei : 

common.     0  ng  may  be  money  ;  and 

Always  and  everywhere  that  which  doe*  the  money-work  is  the  money-thing, 
liald  Alison  HH 

•  specie  payment  in  1707,  making  hank  notes  a  legal  !.:.<!••• 
:  with  an  adts|ii;iie  inti-nial  cur- 

-.  aftton- 
offecta,  and  brought  the  struggle  [of  the  Napoleonic  wars]  to  a  triumphant 

THK  THI.'B  MO5BT  STANDARD. 

The  true  money  standard  of  any  country  i*  not  the  material  of 

i«  ma. I.-.     Tin-  standard  is  not  a  concrete  object, 

but  a  numerical  relation.     It  in  tin-  relation  between  tlie  number  of 


79       , 

units  composing  the  monetary  circulation  of  the  country  and  the 
numbers  of  the  population. 

It  is  the  legal-teiider  function  that  constitutes  money.  It  ia  the 
power  which  the  law  imparts  to  any  material  to  pay  debts  and 
liquidate  obligations.  It  can  not  for  a  moment  be  doubted  that  the 
money  function,  being  conferred  by  the  supreme  authority,  is  the 
all-sufficient  guarantee  of  the  money  value.  There  is  no  necessity 
for  re-eiiforcing  that  value  with  any  inferior  value  that  may  attach 
to  the  material  on  which  the  money  stamp  is  placed.  The  money 
function  is  immeasurably  the  most  important  that  can  be  conferred 
by  society  upon  any  material,  and  it  is  absurd  to  urge  that  that 
function  is  not  of  itself  sufficient  for  the  maintenance  of  the  value 
of  money.  All  the  value  that  money  can  possibly  have — the  totality 
of  value  that  can  exist  in  the  shape  of  money  in  any  country — will 
attach  to  anything  upon  which  the  sovereign  authority  stamps  it, 
whether  the  material  on  which  the  stamp  is  placed  be  gold,  silver, 
paper,  or  anything  else.  Legislators  or  executive  officers  of  the 
Government,  by  increasing  or  decreasing  the  volume  of  money,  cor- 
respondingly decrease  or  increase  the  value  of  each  unit  of  that 
money.  For  no  matter  how  many  or  how  few  the  units  may  be,  the 
total  value  of  the  money  of  the  country  will  be  comprised  within 
the  total  number  of  those  units.  A  change  in  the  number  of  the 
units  effects  a  proportionate  change  in  the  value  of  each  unit,  and 
whatever  the  value  of  the  unit  may  be,  it  is  of  the  utmost  impor- 
tance that  that  value  should  remain  undisturbed. 

It  is  absurd  to  maintain  that  a  gold  unit,  which,  as  time  goes  on, 
is  constantly  increasing  in  purchasing  power,  is  a  better  unit  than 
a  unit  of  any  other  material  that  maintains  unchanging  value 
through  time. 

Whenever  the  business  of  the  country  accommodates  itself  to  a 
given  number  of  units,  the  only  question  for  the  Government  to 
to  deal  with  is  to  maintain  that  value  as  free  from  disturbance  as 
possible  ;  and  according  to  all  authorities  on  political  economy  that 
can  only  be  done  by  increasing  or  decreasing  the  number  of  units  in 
circulation  in  accordance  with  the  demands  of  increasing  or  de- 
creasing population. 

If  it  be  admitted  that  one  of  the  most  important  offices  of  gov- 
ernment is  to  see  that  the  equities  are  preserved  between  its  citi- 
zens (and  if  this  be  not  so,  to  what  purpose  are  our  courts  of  equity 
instituted?),  then  it  can  not  be  denied  that  it  is  one  of  the  high- 
est offices  of  government  to  see  that  money,  which  measures  all 
equities,  and  which  must  for  all  time  continue  to  be  the -principal 
measure  in  the  service  of  civilized  society,  shall  be  of  unchanging 
value.  It  is  impossible  to  secure  this  characteristic  of  uniformity 
in  the  value  of  money  if  we  are  to  select  as  the  only  material  on 
which  to  stamp  the  money  function  a  substance  whose  yearly  pro- 
duction is  becoming  more  and  more  limited,  and  the  prospect  of 
whose  sufficient  yield  becomes  less  and  less  encouraging. 

IP  SILVER  REMAIN  DEMONETIZED  AND  GOLD  CONTINUE  DECREASING,  WHBRB  IS  THH 
WORLD'S  FUTURE  MONEY  SUPPLY  TO  COME  FROM? 

If  the  distinguished  authorities  I  have  quoted  are  correct,  that  a 
diminution  of  the  volume  of  money  increases  the  value  of  the 
money  unit — which  is  but  another  form  of  stating  that  it  lowers 
prices  and  produces  stagnation,  distress,  and  discontent, — what  good 
reason  can  be  offered  by  the  advocates  of  the  gold  standard  for  con- 
fining the  business  of  this  rapidly  growing  country  to  a  basis  of 
gold,  when  it  is  well  known  that  the  entire  stocks  of  gold  and  silver 


80 

together  are  now  insufficient  to  serve  the  purpose  of  the  world's 
money,  ami  have  to  be  supplemented  and  re-enfoi-cd  by  large  issues 
uf  paper  notes!  Do  they  not  reflect  that  the  production  of  gold  is 
.  :itly  diminishing  and  is  likely  to  continue  to  diminish  T  And 
do  they  not  know  that  our  population  is  growing  at  the  rate  of 
over  3  per  cent,  per  annum  and  will  double  in  thirty  years?  Do 
:ean  that,  the  money  volume  which  serves  a  population  of 
G5,UOO,000,  and  is  far  below  the  needs  of  that  population,  will  snilicc 
for  the  130,000,000  of  the  next  generation  T  To  be  sure,  if  we  are  to 
take  no  note  of  prices,  the  question  is  a  simple  one. 

•  rices  must  betaken  into  account.     The  entire  money  ques- 
tion is  one  of  prices.     When  it  is  said  that  money  is  icarce,  what  is 
is  that   business  is  depressed  and  that  money  is  difficult  to 
•  the  present  range  of  prices.     Should  prices  tall  -JT.  per  cent. 
.  would  befonud  plentiful  enough  to  conduct  exchange  at  the 
lower  range,     lint  \\  hen  prices  fall,  goods  .sell  below  cost,  In. 
is  unprofitable,  workshops  are  closed,  and  men  are  thrown  into  idle- 
ness.    If  lowering  prices  do  not  atfec.t  injuriously  either  the  In 
or  the  prosperity  of  the  country,  then  it  makes  no  difference  what 
inn-  of  money  may  be;  a  small  amount  will  meet  the  require- 
.18  well  as  a  large  amount.     In  that  caw,  the  gold  standard  i> 
as  good  as  a  1 1  y . 

Hut  if  gold  alone  is  sufficient  to  bear  all  the  enormous  monetary 
burdens  of  the  Western  world,  why  do  the  advocates  of  the  gold 
,;d  admit  the  necessity  for  anymore  circnlationT  To  be  logi- 
cal, instead  of  favoring  an  increase  of  credit  money,  which  has  al- 
ways lurking  within  it  an  element  of  danger  to  the  business  of  the 
community,  they  should  demand  the  retirement  of  t  !;•  •  .i><>(>  of 

greenbacks  and  the  $350,000,000  of  coined  silver,  and  base  tin 
ness  of  the  country  exclusively  on  what  they  call  "hone.-t  money." 
If  that  should  he  done  all  that  could  happen  would  he  a  fall  in  prici  s. 
Judging  by  the  experience  of  the  past  it  would  not  be  surprising  if 
\t  move  of  the  gold-standard  men  would  be  an  agitation  for 
the  retirement  and  ramella* ion  of  the  greenbacks.  Such  a  move- 
is  fully  in  harmony  with  the  opinions  of  the  gold-standard 
advocates  for  the  paM  twenty  years.  Indeed,  the  Secretary  of  the 
Treasury  who  took  charge  of  the  linances  at  the  opening  of  i1 
Admim.-tration,  himself  a  hanker,  recommended  the  demonetix.ation 
of  the  greenbacks  almost,  as  vigorously  as  he  opposed  silver. 

MO.XRT   VALUAHI.K  ONLY   FOR  TIIK  IMPORTANT  HBRVICK  IT  PERFORMS. 

Money  is  valuable  rather   tor  the  service  which  it  performs  than 

for  the  material  of  \\lu.-h  it  iseompo>..-d. 

\Vli-  .der  the  transceudaiiily  important  character  of  the 

which   money   pei  forms — when  we  retleet    that,   without    it, 
the  achie\  emeiit    of  an    ailvaii'-  .:ion  would  he    impo-sihle. 

we  c«n  not  escape  the  conclusion  that,  compared   with  the  value  <>t 
that   »er\  lee,  thu  commodity    \.  y    material   on    wliich    the 

money  function  may  be   stamped   is  too  trilling  to   merit   serious 

will  be  made  clear  by  reflection  on  the  necessities  of  the  sit- 
on. 
'>ng  aa  ftociety  chooaes  to  maintain   the  automatic  or  metallic 

1    licohvio:  Mint    WOllld 

rrniilt  !  .  nd  o\  ei  \\  helming  increase  in  the  supply  of  the 

i-  coni]iared   With  the  entile  stock   in  ex. 

•  that  would  iv-iilt  from  u  wholly  in- 
.on  to  that  stock,  it  must  ! 


81 

mons  accumulation  of  the  metals  on  which  the  stamp  is  placed.  It 
must  be  manifest  that  no  material  would  be  fit  for  universal  accept- 
ance for  so  important  a  function  as  money  unless  there  were  available 
so  great  a  quantity  of  it  that  no  sudden  shock  could  be  inflicted  on 
society  by  ordinary  fluctuations  in  the  current  yield,  or  in  the  cur- 
rent consumption  in  the  arts. 

But,  in  the  nature  of  things,  a  supply  sufficient  to  effect  that  result 
would  be  so  enormous  as  practically  to  destroy  the  market  value  of 
the  material  as  a  mere  commodity  if  the  money  function  and  use 
were  withdrawn  from  it. 

THE  MONET  DEMAND,  NOT  THE  COMMODITY  DEMAND,  THAT  GIVES  GOLD  ITS  VALUE. 

Mr.  Giffen  the  statistician  of  the  London  Board  of  Trade,  in  an 
article  recently  published  in  an  English  magazine,  berating  and 
deriding  the  bi-metallists,  maintains  that  it  is  not  the  demand  for  gold 
as  money,  but  for  gold  as  a  commodity,  to  be  used  in  the  arts,  that  de- 
termines its  value. 

To  prove  his  case,  Mr.  Giffen  states  that  the  supply  of  gold  is  about 
$95,000,000  per  annum,  the  annual  demand  for  the  arts  $60,000,000,  or 
about  two-thirds  of  the  annual  supply  ;  while  the  demand  for  money 
is  only  $35,000,000,  or  about  one-third  that  supply.  He  therefore 
argues  that  the  art  demand,  being  the  greater  of  the  two,  contributes 
more  largely  to  the  maintenance  of  the  value  of  gold  than  does  the 
demand  for  that  article  as  money.  It  is  hardly  necessary  to  point 
out  the  absurdity  of  this  claim. 

The  commodity  demand  in  any  one  year  is  not  made  upon  the  cur- 
rent year's  supply,  but  upon  the  entire  amount  in  existence,  which,        .. 
is- estimated  to  be  about  $4,000,000,000.     If  the  demand  for  the  arts    ^4~s 
entirely  ceased,  would  the  addition,  to  the  money  volume,  of  the 
$60,000,000  now  used  in  the  arts  produce  any  appreciable  effect  on 
the  value  of  the  $4,000,000,000  in  existence? 

On  the  other  hand,  what  is  the  demand  ou  gold  for  the  money  use? 
All  the  labor  and  all  the  salable  property  of  the  western  world  are 
constantly  offered  in  exchange  for  it.  It  is  a  moderate  estimate  to 
assume  that  each  dollar  is  earned,  demanded,  and  paid  once  a  week, 
or  fifty  times  in  each  year.  This  constitutes  a  total  annual  money 
demand  of  $200,000,000,000,  compared  with  which  colossal  sum  how 
inconsequential  is  the  commodity  demand  of  $60,000,000  in  maintain- 
ing the  value  of  gold. 

The  amount  of  gold  annually  used  in  the  arts  is  not  very  definitely 
ascertained,  but  in  1886  it  was  estimated  by  the  then  Director  of  the 
United  States  Mint  to  be  $46,000,000  per  annum.  Mr.  Giffen  estimated 
it  at  $60,000,000.  It  is  my  opinion  that  the  arts  forage  on  the  money- 
stock  of  gold  to  the  extent  of  about  the  entire  annual  yield.  The 
bullion  or  commodity  value  of  that  metal  being  determined  by  its 
money  value,  whoever  desires  to  use  it  for  any  purpose  other  than 
money,  takes  the  bullion  at  its  coinage  value,  or  else  melts  up  the 
coin. 

Were  gold  demonetized  and  deprived  of  its  money  function,  and 
its  demand  confined  solely  to  that  arising  from  its  adaptability  for 
various  other  purposes,  the  present  stock  of  that  metal  on  hand  and 
in  use  as  money  would,  according  to  the  estimates  of  the  director  of 
the  mint,  supply  the  art  demand  for  more  than  seventy- five  years  to 
come.  But,  assuming  that  the  estimate  of  the  Director  of  the  Mint 
is  too  low,  and  that  my  own  is  nearer  the  truth,  there  is  at  least  fifty 
years'  supply  on  hand.  Were  there  fifty  or  seventy-five  years'  sup- 
ply of  any  other  commodity  on  hand  in  the  market,  what  would  be  the 
JONES — -6 


82 

commercial  value  of  that  commodity  f  What  would  be  the  value  <>f 
copper,  of  brass,  or  of  iron,  if  t!  lifty  or  seventy-tiv. 

supply  of  cither  uf  tln"-i-  metals  in  the  market  for  disposal  at  one 
timeT  Nobody  can  pivteud  that  any  commodity  of  which  there  is 
an  available  supply  on  hand  equivalent  to  the  whole  dcm::: 

nty-livc  years  can  have  any  but  the  most  trilling  value. 
:ary,  therefore,  to  the  generally  received  conviction  that  the 
commodity  demand  is  the  dominating  force  in  fixing  the  value  of 
gold  I  ma'intain  and  insist  that  the  commodity  demand,  if  en: 

I  in  to  the  account  at  all,  is  insignificant.  It  is  the,  supremely  impor- 
tant ffloitfy-deinand,  as  correlated  to  the  supply,  that  fixes  the  value 
of  all  money  o'f  every  description  w; 

The  demand  for  gold  as  a  commodity  is  limited  and  iluoii: 
but  when  that  metal  is  invested  by  law  with  the  higher  func- 
.  and  thus  constituted  a  common  denominator  of  all  \ 
tliat  limited  and  fluctuating  demand  is  changed  to  an  unlimited  and 
constant  one,  which  fixes  its  value  for  other  and  inferior  n.> 
iiiniodity-dcmand  for  gold   were,  as  many  believe   it   ; 

its  acceptance  as  money,  it  would  be  a  groat  misfortune 
to  society.  The  happiness  and  prosperity  of  the  world,  if  not  wholly 
dependent  upon,  are  largely  intluenced  by,  steadiness  in  the  value 
of  money,  and  this  can  not  exist  without  steadiness  in  its  volume. 
Whatever  demand  exists  for  gold  as  a  commodity  can  only  aftVct  the 
volume  of  money  injuriously — that  is  to  say,  by  decreasing  it.  The 
admonition  of  history  is  that  a  deficiency  in  the  money-supply  is 
more  probable,  and  intinitvly  more  to  be  feared  than  an  < 
this  deficiency  is,  in  great  measure,  caused  by  the  insidious  and  <•••!.- 
8-tant  encroachment,  upon  the  precious  metals,  of  demands  for  them 
f'-r  other  than  the  money  use.  When  we  contrast  the  inagni; 
tin-  world's  interests  and  equities,  which  rest  on  stvadinovs  in  the 
value  of  money,  with  the  comparative  unimportance  of  the  uses  of 
the  metals  as  commodities,  it  becomes  apparent  that  the  snl> 
of  the  value  of  money  to  disturbance  from  the  demandH  for  gilded 
looking-glasse-i,  handles  and  breast-pins,  is  an  <-vil  for  \vhich 
is  l»ut  pooily  roin[>en.sated  by  the  be:n-iit««  dr-ivcd  from  such 
M  -. 

Whatever  Other  quality  gold  may  possess  than  as  thelx>arer  of  the 

tion  ia  inconsistent  \\  ith  the  healthful  and  proper  • 
•.isk  assigned  it  as  such.     Whenever  any  port  ion  of  th< 
is  used  for  any  other  purpOM  than  money  it  <!e-.tm\s  theiuur. 
hanges  the  value  <•:   eveiy  unit  of  money  in  circnl;it:> 
as  already  staled — other  things   remaining  nnchan^Ml— th. 
«f  each  dollar  depends  on    the  Dumber  of  dollars  that  are  out.     With- 
out forewarning,  and  without  knowledge  on  the  pan  «•!' ih»«  people. 
large  amounts  of  the  moin-..  .-nwhul.-  i  niiinl.i  i  of 

equities  rrsf,  and  on  the  basis  of  which  all  debts  and  tin 
bare  been  entered  is.  i>titionsl\ 

;   to  other  and  always  infi-ri"-  by  far  the 

•  hich  the  money  func- 

•  . i,  i«  the  i>:  No  other n*e oan  poaaibly 

be  so- high  or  so  u  maintaining  all  oqnitiei  nn<ii>t  ml  ><•<'. 

It  aeems  unworthy  a  highh  -.it:.  :i  \vh,ch,  as  to 

all  (lubjerU  other  th:m  money,  legulate.s  its  :iil';iiis  by  the  »]<]>'.: 
of  int.  .iiid  bases  :ia,  scientilit  ally 

ascertained  aud  corre.ily  applied,  to  <:.-;>«-nd   lm    its  mone\    - 

\\  hich  primitive 
aociety,  by  reason  of  the  liuiitation  of  its  powers  aud  the  ondei 


83 

condition  of  the  human  mind  and  hand,  was  compelled  to  resort.  If 
the  quantitative  theory  of  money  be  correct — if  the  money  standard 
be,  as  I  insist  it  is,  a  steady  and  duly  proportioned  numerical  rela- 
tion existing  between  the  units  of  population  and  units  of  money — it 
is  the  duty  of  society  and  government  to  see  that  as  far  as  practica- 
ble that  principle  is  put  into  operation. 

The  history  of  the  production  of  the  precious  metals  from  the  re- 
motest ages  demonstrates  that  under  the  automatic  system  of  money 
this  can  only  be  ofiected  by  the  unrestricted  coinage  of,  and  confer- 
ring the  full  legal-tender  function  on,  both  metals. 

THE  PROPOSITION  THAT  THE  GOVKRSMKNT  SHOULD  LEXD  MONEY  ON  THE  6ECUUITT, 
OF  1LEAL  ESTATE. 

If  a  change  in  the  whole  number  of  money  units  in  circulation 
relatively  to  population  and  business.do  not  atfect  the  value  of  each 
unit,  then  no  objection  can  be  found  to  the  proposition  recently  pre- 
sented in  the  Senate  by  the  distinguished  Senator  from  California, 
which  created  some  surprise  among   Senators.     The  resolution  of 
that  Senator  contemplates  a  loan  by  the  Government  to  holders  of    -f 
real  estate  baned  upon  the  security  of  the  property  ;  and  the  issue 
of  a  large  amount  of  Treasury  notes  for  that  purpose.     Certainly,  it     r. 
a  dollar,  in  order  to  perform  properly  the  money  function,  must  have     , 
in  it  or  back  of  it  a  dollar's  worth  of  material,   there  can  be  no 
safer  security  found  than  that  suggested  by  the  Senator  from  Cali- 
fornia, namely,  the  arable  land  of  the  United  States. 

It  is  the  most  absolutely  secure  of  all  securities  ;  it  can  neither 
run  away  nor  be  stolen,  it  can  not  be  burnt  up,  lost,  or  destroyed.  I 

Arable  land  is,  in  and  of  itself,  capable  of  supplying  all  basic  wants,  L 
and  must  be  always  in  demand,  while  gold,  so  far  as  concerns  any  ) 
use  to  which  it  is,  or  can  be  applied,  might  be  dispensed  with  alto-  I 
gether,  with  scarcely  any  inconvenience  to  society. 

Certainly  money  based  on  land  would  seetn  to  be  better  than 
money  based  on  gold.  Senators  who  are  sticklers  for  so-called  "  in- 
trinsic value"  money,  and  "full-value"  money,  should  be  found 
supporting  that  proposition.  But  it  must,  on  reflection,  be  obvious 
that,  other  things  remaining  unchanged,  whenever  the  total  number 
of  units  of  money  (or  dollars)  in  the  circulation  of  a  country  increases, 
the  value  of  each  unit  will  decrease.  It  is  an  axiom  of  political  econ- 
omy that  no  amountof  increase  in  the  number  of  units  of  money  in  a 
country  increases  the  aggregate  value  of  the  money  of  that  country. 

The  aggregate  value  of  the  money  in  circulation  in  a  country,  can, 
ceteris  paribus,  be  increased  only  by  an  increase  of  population  and 
business,  that  is  to  say,  by  an  increase  in  the  demand  for  it.  yl 

If.  without  increase  of  ponulatiou,  the  money  of  a  country  be  in-  •* 
creased  from,  say,  $],OlM,OUO,000  to  $2,000,000j)00,  the  effect  would 
be  not  to  add  to  the  aggregate  value  of  the  money  of  the  country, 
but  to  decrease  the  value  or  purchasing  power  of  each  unit  of  the 
money,  so  that  it  would  take  ten  dollars  to  buy  what  had  before 
cost  but  five. 

GOLD  A  FETICH— DEMAND  FOR  A  STANDARD  OF  JUSTICE. 

The  history  of  the  world  attbrds  no  example  of  a  money  system  reg- 
ulate 1  by  human  prescience  and  intelligent  calculation.     It  is  not  too 
much  to  say  that  the  money  system  of  the  world — the  most  impor-  » 
taut  associative  instrumentality  of  civilization,  in  so  far  as  it  is  not    | 
controlled  for  their  own  advantage  by  the  creditor  classes— is  prac-     1 
tically  the  result  of  accident.     We  are  even  less  logical  than  the  an- 
cients, for  they  availed  themselves  of  the  entire  supply  of  money 
JONES 


possible  to  their  civilization  ami  development.  They  used  t  ho  full 
yield  of  both  silver  ami  gold,  while  we,  in  order  to  line  tin-  pockets 
of  a  privileged  caste  of  money-lenders,  reduce  the  money  volume  to 
the  loweM  po-Mhle  minimum  by  discarding  one  of  those  metals  and 
making  all  debts  payable  in  the  other. 

Gold  has  been  erected  into  a  fetich  by  methods  familiar  to  the 
paean  priesthood,  who  forbade  investigation  of  the  claims  of  their 
idol  to  the  superstitious  veneration  of  their  followers.  The  quality 
of  a  universal  standard  claimed  for  gold  has  been  set  up  by  the 
classes  which,  like  that  priesthood,  had  interests  to  be  served  by 
the  superstition.  All  things  else  may  be  subjected  to  the  test  of 
reason  and  argument,  but  the  blightest  approach  to  a  scrutiny  of 
the  claims  of  gold  ns  a  much-vaunted  universal  standard  of  valua- 
tion has  been  repelled  by  interested  casuists  and  sophists  who  con- 
stitute the  sacred  guard  of  the  temple  of  the  idol. 

The  people  of  this  country,  Mr.  President,  begin  very  seriously  to 
doubt  the  sacredness  of  aso-called  standard  by  which  they  have  been 
robbed  of  thousands  of  millions  of  dollars — a  standard  that  despoils 
and  impoverishes  the  toiling  masses,  in  order  to  swell  the  plethoric 
pockets  of  tin-  privileged  few.  From  all  parts  of  the  Hepnblie  we 
learn  that  the  people  have  become  aroused  on  this  subject,  that  they 

'  ml  gold  to  be  a  standard,  not  of  valuation,  but  <>: 
at  ion  and  confiscation. 

The  world  at  large  .shares  to  a   great   extent  in   the  doubts   enter- 
by  tin-  people  of  thi>  country  as  to  the  orthodoxy  of  t  i 
tinning  worship  of  gold.     Throughout    all   Europe   the  suspicion   is 

lo    make    itself    felt,   among  those   who   have    no    pi 

•  ,    that    the   constantly  appreciating   value   of  this 
metal  bodes  no  good  to  society,  however  adva:..  :   may  be  to 
the  mone\ed    classes,  and   especially  the.   money  lenders.      It  begins 
to  be  feared  that   there  :na\   be  too  In                        beDOfl  in  I  hi>  art  itieial 
standard,  and  that  tin-  pressure  upon  tin*  people,  in  the  fall  of  prices 
and  the  increase  of  the  burden  of  debt  and  of  taxes,  which  multiply 
with  time,  may  have                     -^sequences  upon   public  order.     The. 

"fgold,  never  half  enough  to   meet  the    wants  of  tin-    people 
anywl  n  by  \ear  being  drawn  upon  more  and   more  for  use 

in  the  arts,  while  the  \  ield  from  the  mines  is  decreasing,  and  giving 
no  promi-r  nl  any  material  increase  from  any  qnai 

The  .  I   the  time,  the  standard  for  \\hich  the  people 

•  andard  of  equity,  a  standard  of  just  ice.  a  standard 
that  shall  :  i  ly  and  impartially  t  lie  rights  of  but  li  part  ies  to 

:  hat  will  i  My  and  stealthily  add  to  the  burden 

of  the  obligat  tun  uil  either  side,   that    will  not,  under  the 
dealii  of  t  lie  part  ies  for  t  lie  bencf: t  of  1  he  ot  her.       I 

•!••  step  to  a  leali/ation  of  that  standard  is  the  fnl 

right  fill  pn-it  mil  as  a  rarl  of  the  inonev   of  t  he 

"ii   of  the  question,  it    would    be  uncharitable  not 

lions   minds,  of 

d     llliplejlldieed    iliqh  ..ll'ded 

•ipeistiti \\hidi,  notwithstanding 

_;!it   in    ot  I 

•:ilightcned 
•MI  t  hat   we  must 
.in;,   minds  contemplate  the  ]• 

loSS  to  the   i  otr  "Id. 


85 

FEAR  OF  THE  OUTFLOW  OF  GOLD. 

Any  prospect  of  the  outflow  of  gold  is  regarded  as  the  opening  of      r"-— • 
a  veritable  Pandora's  box,  from  which  must  issue  forth  all  the  evils      i 
that  can  afflict  mankind. 

It  is  to  this  fear,  no  doubt  conscientiously  entertained,  that  we 
must  attribute  the  declaration  of  the  President  of  the  United  States 
that  we  do  not  dare  to  tread  on  the  edge  of  so  dangerous  a  peril.  It 
is  not  difficult  to  make  the  statement,  but  it  will  be  very  difficult  to 
prove  that  we  stand  on  the  edge  of  any  peril  whatever,  if  most  or 
even  all  our  gold  should  go. 

We  heard  this  same  apprehension  expressed,  and  with  equal,  if  not 
greater,  force  twelve  years  ago,  when  the  silver  question  was  before 
this  body.  We  were  then  assured  by  the  ablest  of  our  so-called 
"  financiers  "  that  the  country  would  be  denuded  of  its  gold  and  that 
all  manner  of  dreadful  catastrophies  would  result.  The  prospect  was 
represented  to  be  appalling,  although  I  do  not  remember  that  any 
reasons  were  given  to  show  how  or  why  gold  should  leave  the  coun- 
try, nor  that  any  statement  was  made  as  to  exactly  how  this  country 
woukl  suffer  if  it  did  leave. 

For  my  own  part,  Mr.  President,  I  regard  it  as  a  matter  of  very 
little  consequence  whether  gold  goes  out  or  not.  Certainly  if,  in 
order  to  retain  gold,  we  must  sacrifice  justice,  then  I  say  let  gold  go. 

It  is  not  of  so  much  consequence  that  we  should  retain  gold  for  the 
benefit  of  a  small  coterie  of  importers  as  that  we  should  preserve 
the  equity  of  time  contracts  between  the  millions  of  our  own  people 
who  import  no  foreign  goods.  It  is  monstrous  to  think  of  violating 
all  equities  in  time  transactions — and  nine  out  of  every  ten  of  our 
•domestic  business  transactions  are  of  that  character— for  the  absurd 
and  inconsequent  purpose  of  keeping  in  this  country  some  particular 
commodity,  whether  it  be  designated  as  money  or  otherwise. 

The  hoarding  or  the  outflow  of  gold  is  a  hardship  when,  under  the 
law,  somebody  is  obliged  to  have  it,  as  was  the  case  during  the  war, 
when  gold  alone  would  pay  duties  on  imports.  Combinations  to  hoard 
gold  at  that  time  frequently  involved  great  loss  to  the  importer. 
But  thanks  to  the  silver  legislation  of  1878  and  other  legislation  mak- 
ing our  Treasury  notes  receivable  for  customs  dues,  no  damage  could 
now  result  from  any  attempted  corner  in  gold. 

The  creditors  of  this  country  never  can  convince  the  enterprising 
and  energetic  people  who  form  the  debtor  class  that  it  is  to  our  in- 
terest that  a  certain  material  shall  be  kept  in  the  country  as  money, 
if  the  expense  of  keeping  it  is  that  the  debtors  shall  continue  to  be 
•despoiled  as  they  have  been  for  the  past  fifteen  years. 

If  we  can  only  retain  gold  at  the  expense  of  steady  and  unwaver- 
ing prices,  and  at  the  expense  of  a  steady  and  unchanging  value  in 
money,  then  the  quicker  gold  goes  out  the  better.     The  constantly 
increasing  value  of  gold  by  reason  of  its  increasing  scarcity  means 
the  constantly  increasing  burden  of  all  debt,  and  involves  the  final 
absorption  of  all  the  property  of  the  country  by  the  creditor  classes. 
Under  the  operation  of  the  present  system,  by  which  prices  are  con-  , 
stantly  falling  and  money  ia  constantly  increasing  in  value,  the/ 
surplus  earnings  of  the  people  are  flowing  in  a  steady  stream  intoj 
the  vaults  of  money-lending  institutions,  and  into  the  pockets  of* 
creditors. 

In  a  very  intelligent  article  published  in  a  late  number  of  an  in- 
fluential magazine — the  Political  Science  Quarterly — there  is  the 
significant  statement,  apparently  derived  from  the  best  sources,  that 


88 

in  the  year  1879-'80,  one-half  of  all  the  mortgages  iu  the  State  of 
Indiana  were  foreclosed. 

It  were  better  for  society  that  property  should  at  once  be  confis- 
cated than  that  the  great  masses  of  the  people  in  every  community 
should  have  to  struggle  through  years  of  painful  and  exhausting  ef- 
fort in  the  face  of  constantly  falling  prices  and  then  iu  a  large 
Krcentage  of  cases  to  lose  their  property  at  last.  But  this  can  not 
avoided  so  long  as  we  attempt  to  keep  up  what  is  called  the  gold 
1  standard.  It  is  a  necessary  consequence  of  the  gold  standard  that  we 
shall  have  the  scale  of  prices  that  obtains  in  gold  standard  countriefj 
If  the  presence  of  gold  in  this  country  is  to  destroy  our  peopTeT  u  ho 
doubts  that  it  should  go  T  If  its  presence  is  to  result  in  the  destruc- 
tion of  equity  and  justice,  who  doubts  that  it  should  go  T 

Nearly  every  witness  who  testified  before  tbe  secret  committee  of 
the  House  of  Commons  in  1857  agreed  that  gold  could  only  he  held 
by  paralyzing  the  business  of  the  country.  It  is  estimated  l>y  wit- 
nesses who  testified  before  that  committee,  that  iu  the  panic  of  1847, 
in  Great  Britain,  the  property  of  the  country,  by  reason  of  the  meas- 
ures rendered  necessary  to  maintain  the  single  gold  standard,  wajj  de- 
\preciated  $1,500,000,000.  I  commend  that  report  to  the  careful  and 
serious  perusal  of  the  advocates  of  the  single  gold  standard  in  this 
country. 

Among  tbe  witnesses  before  the  committee  were  John  Stnart  Mill, 
Lord  Overstone,  and  many  other  men  distinguished  in  the  world  of 
letters  and  finance.  I  am  informed  by  the  Librarian  of  Congress  that 
re  is  hut  one  copy  of  the  work  in  the  U nit- d  States.  It  would  be 
well  worth  while  for  Congress  to  order  a  number  of  copies  of  it 
printed,  for  there  is  no  work  with  which  I  am  acquainted  that  con- 
tains BO  much  practical  information  as  to  the  wor^in^  of  the  single 
gold  standard.  According  to  the  testimony  taken  l»f<nc  that  < 
rnittec,  the  experience  of  (it  lit  ^hows  that  gold 

alone,  even  when  re-en  forced  by  pap»r  money  convertible  exclusively 
into  gold,  instead  of  K-ing  u  •  .  instrument  of  valuation,  has 

proved  a  cruel  instrument  of  injustice. 

.•if  consideration  or  i  which  ati'oct  the  movement  of 

gold  will  not  be  out  of  place  in  t!  on. 

KATI03AUC  OF  THE  MOVEMENT  OF  I 

Why  is  it  that  gold  leaves  one  country  and  g-»es  to  ano  thor  T  For 
one  reason  only — the  advantage  of  its  owner.  \Vhenevi-rhi  can  make 
a  |  tiding  it  out,  the  gold  goes;  and  the  period 

profit  can  be  made  is  indicated  when  the  prices  of  ^..i><is  t 
/   temntionally  dealt  in  are  either  rising  in  the  cmmti  \  which  it  loaves 
J    or  falling  in  the  country  to  which  it  go<!8.     It  is  only  to  pay  for  im- 
1">!  .  i:itry  in  which  • 

ng  an  international  mou.-.     .  ibis  every  v 

MS  full  face  value,  gold  loses  nothing  by   trun-fcr;    hence  it    is 
sent  wherever  it  will  for  the  time  being  nave  the  greatest  pm. 
in* 

never  tbe  general  range  of  prices  in  tins  country  <>f  com  modi- 
iy  dealt  in  becomes  higher  than  the  general  range 
I  Of  the  SS  M  that  then  gold  <•;; 

I   used  to  advantage  b\  purchaning  those  nrtu  les  abroad  and  selling 
them  here.      If  t  behold  that  goes  nut   £>>••*  Mom  stock  thai 
hoard)  no  immediate  or  direct  effect    upon 

prices  i:  •  the 

_•  prices   t !  :  iius 

y  tends  to  secure  for  our  exported  producUta  betterprice  in  tin  L.I.  ;-n 


87 

market.  But  if  the  gold  goes  from  the  amount  that  is  in  active  cir- 
culation here,  and  if  the  void  created  by  this  outflow  is  not  tilled 
with  other  forms  of  money,  such  as  silver,  or  paper,  it  results  in  a  re- 
duction of  the  volume  of  money  in  actual  use  in  this  country,  while 
at  the  same  time  increasing  the  volume  of  money  abroad. 

This  increase  in  the  foreign  money  stock  causes  a  rise  of  prices    v 
abroad,  while  the  corresponding  reduction  of  our  currency  causes 
a  proportionate  fall  of  prices  here,  hence  there  is  a  constant  ten- 
dency to  an  equilibrium  of  prices  of  all  articles  of  international  / 
commerce. 

No  outflow  of  gold  would  follow  a  rise  of  prices  here  except  in  so 
far  as  that  rise  affected  articles  internationally  dealt  in.     No  rise  of 
prices  of  such  articles  as  we  do  not  import  would  tend  in  any  way 
to  drive  out  gold.     If,  for  example,  raw  cotton  should  increase  in 
price  m  this  country,  that  fact  would  not  tend  to  drive  out  gold,  be- 
cause we  do  not  import  raw  cotton.     But  should  the  prices  of  articles    I 
of  manufactured  cotton  rise  here  above  what  those  same  articles  could   I 
be  bought  for  in  any  foreign  country  our  merchants  would  send  abroad  I 
for  them,  provided  that,  after  paying  the  freight  charges  and  cus-  f 
toms  dues,  they  could  make  a  profit  on  them. 

So,  also,  if  crockery- ware  were  made  in  this  country,  and  its  price 
should  rise  to,  say,  double  the  present  price,  then,  instead  of  buying 
the  American,  or  home-made  article,  our  crockery  merchants,  finding 
that  they  could  buy  in  England,  France,  or  Germany  cheaper  than 
they  could  buy  in  this  country,  would  decline  to  buy  the  American 
crockery,  apd  would  send  abroad  for  any  article,  provided  that,  after 
paying  freight  charges  and  customs  dues,  they  could  sell  it  here  at  a 
profit,  'i'hat  would  tend  to  increase  the  shipments  of  gold  to  foreign 
countries. 

That  an  outflow  of  gold  does  not  follow  from  a  rise  of  general 
prices,  but  only  of  prices  of  articles  of  international  trade,  is  mani- 
fest from  the  fact  that  if  land  becomes  cheap  in  other  countries,  gold    » 
does  not  leave  this  country  to  buy  it.     When  real  estate  is  cheap  in    ] 
Brazil,  or  Australia,  or  in  Germany,  France,  or  even  England,  the    / 
owners  of  gold  in  this  country  do  not  send  it  abroad  to  make  pur- 
chases of  real  estate. 

So  wages  of  labor  may  rise  in  this  country,  or  compensation  for  all 
manner  of  services  that  must  be  performed  here,  and  gold  woujd  not 
leave  as  a  consequence.     But  if  cloth  were  cheaper — quality  consid-    . 
ered, — in  England,  France,  or  Germany,  or  at  the  remotest  ends  of    i 
the  earth, — than  in  this  country,  our  merchants  would  send  gold  for  it     1 
in  order  to  sell  it  here  at  a  profit. 

Altogether  too  much  importance  is  attached  to  the  possession  of  a 
large  stock  of  gold,  unless  that  stock  form  part  of  the  active  circu- 
lation of  the  country.  So  long  as  it  remains  in  circulation  it  sus- 
tains prices  and  develops  industry  and  internal  commerce.  But  the 
tendency  of  gold  being  to  find  the  most  profitable  field  for  operation, 
its  continued  presence  in  the  country  can  never  be  relied  upon. 

When  we  take  gold  from  other  countries  prices  in  those  countries 
fall,  owing  to  the  reduction  of  the  volume  of  money  there;  and  owing 
also  to  the  action  of  the  foreign  banks  in  immediately  raising  their 
rates  of  discount  on  commercial  paper  and  suddenly  calling  loans.    As   \ 
there  is  less  money  left  in  such  country  with  which  to  pay  for  com-    f 
modities,  we  are  obliged  to  accept  lower  prices  lor  the  products  we 
ship  to  it. 

The  larger  the  stock  of  gold,  therefore,  accumulated  by  UB  the  lower, 


83 

necessarily,  mnst  be  the  price  •which  we  can  receive  for  onr  surplus 
agricultural  product*. 

* t      In  order  to  maintain  purity  between  the  metals,  it  is  not  necessary 
»  /  for  us  to  have  all  the  gold  we  now  have ;  $£00,000,000,  or  even 
$100,000,000  of  gold,  would  maintain  that  parity.     The  parity  be- 
tween the  metals  can  never  be  broken  until  all  the  gold  leaves,  and 
provided  we  retain  one  or  two  hundred  million,  the  rest  can  not  be 
placed  more  advantageously  than  where  our  languishing  surplus 
»v  product*  must  be  sold. 

V>  When  gold  leaves  this  country  it  is  because  prices  here  are  rising. 
Prices  are  now  lower  than  they  have  been  since  1647.  Mnst  iln-y 
continue  declining  in  order  that  we  may  be  able  to  retain  all  our 
goldT  It  is  manifestly  impossible  for  the  people  of  this  country 
t<>  prosper  with  a  constantly  lowering  range  of  prices.  It  is  equally 
impossible  for  the  present  level  of  prices  to  be  maintained  with  u 
constantly  increasing  demand  for,  and  as  constantly  diminishing 
a  supply  of,  gold.  It  is  universally  admitted  that  an  increase  in  the 
money  circulation  of  this  country  at  the  present  time  is  an  exigent 
necessity.  The  advocates  of  the  single  gold  standard,  while  udmit- 
ting  that  we  mnst  increase  our  money  volume,  the  effect  of  which 
mnst  be  to  maintain,  if  it  does  not  raise,  the  level  of  prices  here, 
insist  that  we  shall  let  none  of  onr  gold  go  in  order  that  prices  abroad 
may  rise. 

Mr.  BLAIR.     May  I  ask  the  Senator  a  question  T 

Mr.  JONES,  of  Nevada.    Certainly. 

Mr.  BLAIR.  Does  the  Senator  mean  to  be  understood  that  the 
falling  of  prices  is  an  absolute  demonstration  of  the  increased  value 
of  the  money  without  limitation  T 

Mr.  JONES,  of  Nevada.  I  have  already,  in  the  early  portion  of  my 
remarks,  had  occasion  to  state  that  when  a  fall  in  prices  was  brought 
•boat  by  a  larger  subordination  of  the  forces  of  nature  to  the  uses  of 
man,  as  where  the  comforts  and  conveniences  of  life  could  be  pro- 
duced with  less  sacrifice  than  before,  it  was  not  an  injury  to  society, 
but  an  advantage.  In  other  words,  if,  by  a  certain  amount  of  sacri- 
fice seventeen  yean  ago,  only  one  pair  of  shoes  could  be  produced, 
and  if  by  the  same  sacrifice  two  pairs  could  be  now  produced,  there 
would  be  a  lowering  of  the  price  of  shoes  to  about  one-half  of  what 
it  was  seventeen  years  ago,  which  would  be  a  very  great  benefac- 
tion to  mankind. 

Hut,  as  I  then  stated,  there  is  one  certain  sign  that  that  is  not.  ex- 
to  (he  slightest  extent,  the  cause  of  the  present  universal  fall 
of  price*.  When  prices  fallowing  to  improvements  in  manufacture, 
business  revives,  the  masses  of  the  people  are  at  work,  those  who 
toil  hud  themselves  possessed  of  more  of  tin-  comfort*,  of  the  con- 
veniei  VCD  nf  t  lie  luxuries  of  life  than  In-fore.  Th< 

better  contented  with  their  condition,  and  more  buoyant  and  hope- 
ful than  before.  On  such  occasions  money  becomes  more  and  nmre 
in  demand  than  it  was  before,  and  instead  of  being  hoarded  is  put 
into  active  and  productive  business  where  it  will  make  a  profit.  Hut 
when  interest  falls,  pan  i>a»tu,  with  the  fall  of  prices,  it  shows  that 
the  fall  of  prices  is  not  one,  except  in  the  smallest  degree,  to  im- 
proved methods  of  production,  but  to  the  increased  value  of  money. 

Mr.  HLMi;      I  wa-.  not   contro\er!ing  the  Senator's  theory  as  to 
the  exiiting  fu< -IN  in  thi*  country,  but  I  understood  him  to  be"l.< 
down  an  absolute  principle,  applicable  under  all  ci  re  u  instances  ana 
in  all  times,  that  the  fill  of  prices  is  a  demonstration  of  the  increased 
ralne  of  money.    I  supposed  that  the  fall  in  prices  resulting  from  a 


89 

protective  tariff  was  beneficial,  and  not  an  indication  of  an  increase 
in  the  value  of  money,  and  that  that  fall  of  price  was  not  owing  to 
the  increased  value  of  money,  but  was  by  improved  machinery  and 
all  that.  So  it  is  possible  that  some  of  the  fall  in  prices  in  this 
country  may  be  owing  to  increased  facility  in  the  matter  of  produc- 
ion  and  to  the  beneficial  operations  of  the  protective  tariff. 

Mr.  JONES,  of  Nevada.     Mr.  President 

Mr.  REAGAN.  If  the  Senator  from  Nevada  will  permit  me,  I  wish 
to  ask  the  Senator  from  New  Hampshire  if  he  means  to  be  under- 
stood as  assuming  that  a  protective  tariff  reduces  the  value  of  the 
commodities  produced  ? 

Mr.  BLAIR.  I  was  simply  asking  for  information  of  the  Senator 
from  Nevada,  and  he  can  answer  that  question  much  better  than  I ; 
but  the  Senator  from  Texas  understands  very  well  that  I  do  believe 
a  protective  tariff  reduces  prices. 

Mr.  JONES,  of  Nevada.  Mr. -President,  so  far  as  a  tariff  has  the 
effect  of  reducing  prices  in  any  country,  it  is  not  by  reason  of  the 
levying  of  any  certain  percentage  of  duty  on  the  imported  goods. 
The  first  effect  of  the  tariff  certainly  always  must  be  to  raise  prices. 
The  fundamental  theory  of  the  tariff  is — whether  it  be  correct  or  not 
I  am  not  now  discussing — that  by  that  tariff  you  place  the  price  of 
manufactured  goods  up  to  a  range  at  which  they  can  be  produced  in 
the  country  in  which  the  tariff  is  levied,  and  upon  the  level  of  the 
range  of  wages  and  manner  of  living  which  obtain  in  that  country. 
By  so  doing,  if  you  have  a  proper  volume  of  money,  you  set  all 
your  people  at  work,  and  keep  them  at  work  at  a  variety  of  occupa- 
tions. In  such  case  every  forge,  furnace,  and  factory  becomes  a 
school,  every  machine-shop  an  academy,  and  every  cunning  device 
and  invention  becomes  a  lesson,  teaching  the  people  how  to  deal  with 
the  subtle  forces  of  the  universe.  So  far  as  this  country  is  concerned 
the  theory  of  the  tariff  is  that  65,000.000  people  should  have  a  varied 
and  complete  system  of  manufactures,  which  should  supply  practi- 
cally all  their  own  wants,  instead  of  an  abnormal  proportion  of  them 
being  driven  into  the  single  occupation  of  farming  and  relying  on 
foreign  manufacturers  to  supply  such  finished  products  as  they  need. 
To  draw  out  and  develop  the  aptitudes  of  a  people  a  large  variety 
of  occupations  is  indispensable.  When  all  men  are  employed  at  their 
aptitudes  new  inventions  multiply,  progress  is  accelerated,  and  the 
secrets  of  nature  are  more  rapidly  unfolded.  Hence  the  McCormick 
reaper;  hence  the  sewing-machine,  that  great  instrument  which 
clothes  the  world,  because  of  the  discovery  that  the  eye  of  the  needle 
should  be  at  the  point ;  hence  the  air-brake,  the  telegraph,  the  elec- 
tric light,  and  thousands  of  other  inventions  that  a  protected  people 
originate  and  develop,  which  would  perhaps  not  have  been  origi- 
nated or  might  have  been  long  delayed  if  it  had  not  been  for  the  dis- 
couragement to  imports  caused  by  the  tariff,  and  the  encouragement 
to  our  people  to  go  into  manufactures  by  which  their  varied  talents 
.are  drawn  out  and  cultivated. 

There  is  no  doubt  that  eventually  as  our  conditions  improve,  in- 
creasing numbers  of  our  people  will  by  degrees  emerge  from  agricult- 
ural and  enter  manufacturing  pursuits.  A  tariff,  by  stimulating  the 
organization  and  development  of  industries,  trains  men  to  greaterskill 
and  perfection  of  workmanship  in  a  variety  of  depart  uaents,  and  with 
greater  skill  comes  greater  efficiency  of  labor,  and  so  greater  economy 
of  time.  In  that  way  the  prices  of  certain  products  are  in  time  re- 
duced ;  but  that  is  not  a  reduction  of  which  any  one  complains. 


90 

The  trne  canse  of  the  present  discontent  will  not  be  found  in  the 
protective  tariff,  but  in  the  exactions  of  the  single  gold  standard. 

Fifteen  years  ago  England  was  on  the  gold  standard.     It    i-  on 
the  gold  standard  to-da\  ;  yet  prices  in   England  are  ;{.">  p«-r  «•«  nt. 
lower  than  they  were  fifteen  years  ago.     Then-  being  no  reason  \\  by 
there  should  be  any  change  in  the  trend  of  prices,  so  long  as  a  tieiee 
contest  for  the  possession  of  gold  shall  be  waged  l>et  \\e--n  Kngland, 
France,  Germany,  and  the  United  States,  we  are  just  i tied  in  u 
ing  that  a  proportionate  declineof  prices  will  continue.    That  n  • 
a  further  decline  of  30  or  35  per  cent,  in  prices  during  the  next  tilt,  en 
years.    Where  is  this  tendency  to  stop  f  and  if  it  does  not  stop,  how 
long  will  it  be  before  the  masses  of  the  people  become  the  boini 
of  the  creditors?     It  is  shocking  to  the  moral  sense  of  mankind  that  a 
//  few  money-lenders  and  bondholders  should  thus  be  able,  silently  a. id 
insidiously,  to  wreck  the  business  of  every  country  in  the  world  by 
v  constantly  increasing  the  value  of  the  money  unit. 

While  admitting  the  necessity  of  more  monetary  circulation,  our 
gold  standard  friends  fail  to  show  us  how  it  i-  possible  for  an  iuc: 
m  the  volume  of  money  to  benefit  our  merchants,  farmers,  or  mechan- 
ics if  the  prices  that  prevail  in  gold  standard  « -omit  i  ie-  are  to  )>i«  vail 
here  ;  for  that  is  what  the  gold  standard  means  for  us,  Mr.  ! 
It  means  that  the  prices  that  rule  in  gold  standard  count rii  >  an-  to 
rule  here. 

The  extreme  indefiniteness  with  w hich  the  term  "gold  standard  " 
is  used  baa  so  befogged  the  relation   which  gold  money  bears  to  in- 
dustry and  commerce  that  people  lose  sight  of  the  essential   f<  attire 
of  that  relation.     It  is  impossible  to  have  a  clear  conception  of  the 
gold  standard  without  keeping  in  view  exactly  what  is  implied  by 
the  term.     What  men   must   nlean    in   this  country    by    "the  gold 
Standard  "  is  not  the  touch   of  the    im -tal.  l'<>r   tl:.\    M«  ver  touch  it, 
and  rarelv,  if  ever,  see  it.     The  maintenance  of  the  gold  standard 
here  simply  means  the  maintenance  here  of  the  range  ot  pi  ice-  that 
prevail  in  gold -using  countries;  that  is  to  say,  that  low  and  low*  ring 
range  of  prices  rendered  necessary  by  the  attempt  to  nn .: 
\     value  of  the  constantly  increasing  mass  of  the  piodiu-ts  of  industry 
\    in   all    the  western  world   by  the  constantly  diminishing  volume  uf 
J    gold.     No  relief  can  come  to  the  toiling  masses  of  this  country  until 
|    we  can  lift  our  prices  above  those  that  now  prevail  in  gold-i 
countries. 

D  if  our  prices  remain  as  they  are  and  do  not  increase,  gold 

will  eventually  leave  the  country  if  it  continue  to  increase  in  value 

Mil  has  been  increasing  during  the  past   fifteen  years.     We  ha\e 

been  enabled  to  maintain  the  gold  standard  hen-  for  the  past  twelve 

years  notwithstanding  i:iblc  addition  of  nnmes  other  than 

'nt  we  have  been  aid--  to  <!o  .-<>  only  because 

•ntricH  hav«  been  using  an  equal  or  greater  amount  of  ni»ney 

other  than  gold.    We  have  been  using  no  greater  ptopoi  tion  ot  silver 

or  p.ipi-r  M .i.ney  than  other  countries  ha\  ing  (lie  gold  standard  are 

using,  hence  we  have  b« «  n  able  to  maintain  I  heir  level  of  prn ••  -  and 

Still  keep  the   mct.Js   :•  llm  \\  hene\  ei   \\.-  shall   atten  pt  to 

prevent  a  further  fall  of  prn.  •-  in  this  country,  it  will  i>e  impossible 

•  1 1  to  i.  1. 1 1  n  our  gold  so  long  as  price*  in  gold  n -ing  conn  trie-  con- 

tinnc  to  decline  ;m   they   have   been    d*M-limng.     <••.].!  \\ill   leave  M 

3'  cause  ofcontrae  tion  abroad  as  of  inllation  here,  if  by    '  in- 
ation"  is  meant  acoinag.  -uihci.i,t  to  maintain  prices  at 

]    a  steady  level. 

Should  gold  leave  the  country,  then,  in  order  to  supply  its  place, 


91 

in  order  to  maintain  the  status  quo  in  prices,  and  prevent  a  further 
fall  from  the  present  low  range,  we  should  need  to  have  as  many 
dollars  of  silver  in  circulation  as  there  are  now  dollars  of  gold.  Gold 
would  go  out  only  because  our  prices  were  rising,  and  as  it  went 
prices  would  cease  to  rise.  That  process  might  continue  until  three 
or  four  hundred  million  dollars  of  gold  had  gone.  In  all  this,  where 
would  be  the  disadvantage  to  our  people  ? 

Considering  the  rapidly  increasing  population  and  wealth  of  this 
country,  all  the  silver  that  can  be  procured  from  the  mines  will  be 
necessary  to  maintain  the  level  of  prices  and  to  keep  pace  with  the 
increasing  demands  for  money.  If,  however,  it  slightly  exceeds — and 
it  could  not  at  the  utmost  more  than  slightly  exceed — the  amount 
actually  demanded  by  increasing  population  and  business,  the  over- 
plus of  each  year  would  take  a  great  many  years  to  drive  gold  out 
of  the  country,  dollar  for  dollar.  For,  when  prices  here,  of  things 
internationally  dealt  in,  are  at  an  equilibrium  with  prices  of  the 
same  articles  abroad,  gold  can  not  go  any  faster  than  silver  conies  in. 

IF  $2,500,000  SILVEB  FEB  MOXTH  HAS  NOT  DRIVEN  OUT  GOLD,  HOW  MUCH  WILL  DO  60? 

For  twelve  years  past  we  have  had  a  silver  coinage  of  nearly 
$2,500,000  a  month,  yet  no  gold  has  been  driven  out.  Having  tested 
the  capacity  of  that  quantity  of  silver  to  drive  out  gold,  we  find  that 
instead  of  driving  it  out  its  coinage  has  resulted  rather  in  bringing 
gold  in.  For,  to  whatever  cause  the  influx  of  gold  may  be  ascribed, 
it  is  unquestionable  that  the  gold  has  come,  and  it  has  needed  all  that 
gold,  and  all  the  silver  that  we  have  coined,  to  maintain  interna- 
tional prices  hrre. 

It  is  admitted  by  all  that  gold  can  not  go  out  except  by  reason  of 
a  rise  in  this  country  of  the  prices  of  articles  of  international  com- 
merce beyond  the  prices  of  the  same  articles  prevailing  abroad.  It 
is  only  then  that  it  becomes  more  profitable  to  send  out  gold  in  pay- 
ment for  our  foreign  purchases  than  to  send  out  commodities — the 
products  of  our  own  country.  Commodities  will  always  be  sent  out 
in  payment  for  other  commodities  so  long  as  it  is  more  profitable  to 
send  them  than  gold,  and  when,  by  reason  of  low  prices  prevailing 
abroad  and  high  prices  here,  it  is  no  longer  profitable  to  send  out 
commodities,  purchasers  send  out  gold,  but  only  because  it  is  to  their 
advantage  to  do  so. 

Now,  having  seen  that  the  coinage  of  $2,500,000  of  silver  each 
mouth  was  insufficient  to  so  raise  prices  in  this  country  as  to  induce 
gold  to  go  abroad,  but  that  on  t'he  contrary  it  resulted  in  an  influx 
and  accumulation  of  a  large  amount  of  gold,  we  may  safely  assume 
that  only  so  much  of  the  amount  of  silver  which  Congress  shall  now 
provide  for  as  exceeds  $2,500,000  a  month  will  have  any  influence 
in  raising  prices  in  this  country  above  international  prices,  and  so 
providing  a  stimulus  for  gold  to  go  abroad  in  payment  for  commod-  j 
ities  imported  into  this  country. 

If  the  amount  of  silver  which  shall  be  now  provided  shonld  be, 
say,  $5,000,000  a  month,  the  excess  over  the  present  coinage  would 
be  $2,500,000  a  month.  This,  then,  would  be  the  amount  that  would 
drive  out  gold.  As  one  dollar  of  silver  would  drive  out  no  more  than 
one  dollar  in  gold,  no  more  than  $2,500,000  could  go  out  monthly. 
That  would  leave  in  circulation  the  same  amount  of  money  that  is 
in  circulation  now.  There  would  still  be  no  increase  in  the  money 
volume  of  the  country,  and,  with  no  increase  in  the  volume  of 
money,  prices  here  would  not  rise  above  international  prices.  At 
the  rate  of  $2,500,000  a  month,  it  would  take  twenty  years  to  drive 


out  1600,000,000  of  the  $700,000,000  of  gold  now  in  this  country.  It 
would  take  even  longer  than  that,  because  the  $600,000,000  driven 
out  would  tend  to  raise  international  prices  abroad,  and  so  check 
tin-  outflow  of  gold  from  here. 

Mr.  Mcl'HKKx  >N.     Will  the  Senator  yield  to  me  for  a  question, 
or  does  he  prefer  to  go  on  T 

Mr.  .)'  >N  ;  ula.     I  am  always  ready  to  answer  a  question. 

Mr.  Ilel'llKKSON.     I  do  not  want  to  interfere  with  the  Senator's 
iii.t   of  argument,  or  with  his  speech  in  any  form,  hut  it  does  seem 
to  me  that  there  is  something  fallacious  about  the  Senator's  argu- 
ment, or  else  my  judgment  and  the  experience  of  the  world  is  all 
wrong.    I  wanted  to  ask  the  Senator  this  question  :  If  it  be  known 
that  the  Government  of  the  United  States,  if  you  please,  by  such  an 
increase  of  the  silver  coinage  in  this  country  an  will  be  produced  by 
the  tree  coinage  of  silver,  to  which  theory,  as  I  understand,  the  Sen- 
ator is  fully  committed — if  that  be  the  theory  of  the  Government 
[hereafter  by  the  command  of  Congress,  I  want  to  ask  the  Senator  if 
I  be  broadly  and  boldly  asserts  that  no  gold  can  be  driven  out  of  the 
1  country  to  a  greater  extent  than  dollar  for  dollar  for  the  silver  that 
jconies  in  ? 

Mr.  JON  KS,  of  Nevada.  Absolutely ;  I  say  so. 
Mr.  Mcl'll  KUSON.  Then  I  want  to  ask  the  Senator  another  ques- 
tion, which  seems  to  be  pertinent.  Does  the  Senator  assert  that  if  a 
72-cent  dollar,  the  value  in  bullion  of  a  silver  dollar  during  the  year 
1889,  as  has  been  furnished  us  by  the  Director  of  the  Mint  and  the 
Secretary  of  the  Treasury,  were  coined  without  limit  ( I  say  without 
limit,  the  limit  being,  of  course,  the  amount  of  bullion  that  is  brought 
to  the  Treasury  to  be  coined),  and  the  people  of  this  country  who 
have  been  in  favor  of  a  safe  and  honest  currency,  a  currency  either 
gold  or  as  good  as  gold,  which  the  Treasury  has  been  able  to  main- 
tain, having  forced  no  silver  upon  the  people  if  they  did  not  wish  it, 
and  in  that  way  the.  silver  dollar  having  been  maintained  equal  to 
the  gold  dollar,  I  want  to  know,  with  the  people  of  this  country 
.  the  holders  of  $500,000,000  of  gold,  how  it  is  possible  for  the 
Senator  to  believe  that  with  a  72-cent  dollar  to  take  its  place  the 
gold  coin  would  circulate  for  a  single  we.  k.  or  u  single  day,  or  a 
•ingle  hourT  If  they  have  the  gold  will  they  not  hold  itf 

JONES,  of  Nevada.     The  Senator  has  so  involved  his  <p< 
with  his  argument  that  I  can  scarcely  get  at  what  he  wants  me  to 
Answer. 

Mr.  M.TIIKKSON.    The  question  I  want  th«  Senator  to  answer 

is  this  :  Will  the  people  of  this  country,  tin-  financiers  of  this  «>un- 

.e  btinkH,  tin-  moneyed  men  holding$500,000,000of  gold,  with  a 

certainty  «>i  tin-  free  coinage  of  silver  and  nomg  to  a  silver  basis,  for 

.•«  what  it  means,  put  their  gold  in  circulation,  or  will  they 

hoard  it  T     Will  it  disappear! 

Mr.  .)<  >N  KS.  of  Nevada.    I  scarcely  know  what  the  Senator  means 

by  a  "silver  basis."     He  talks  about  a  Tv'-ccnt  dollar.     W«  have 

•   seen  a  72-cent   dollar.     The  papers  in  the  Kant  have  told 

ns  that  th«*  silver  dollar  was  worth  72  cento.     I  recollect  talking 

on  that  subject  once  with  Home  Senators  in  the  cloak-room.     During 

one  of  the  Senate  pages  brought  me  a  telegram,  on 

he  tan!  the  Megraph  mrMenger  had  told  him  there  were 50 

due.     1  gave  the  page  a  silver  dollar  and  said  to  him:  "  I  have 

been  i  >v  some  very  respectable  and  intellectual  gentlemen 

inhere,  someof  them  candid  ..i.  •-  f..r  the  Presidency  even,  that  ti 

lar  Is  worth  only  76  cento.    1  do  not  want  to  cheat  a  little  boy.    Take 


93 

this  out,  and  if  the  boy  thinks  it  worth  only  75  cents  he  can  send  me 
back  25  cents,  and  if  he  thinks  it  is  worth  a  dollar  he  can  send  me  back 
50  cents.  I  will  leave  it  to  him."  The  page  brought  back  50  cents 
and  said  the  telegraph  boy  told  him  he  did  not  know  what  those  old 
"duffers"  in  there  might  say.  but  it  was  as  good  a  dollar  as  he 
wanted  and  was  very  hard  to  get.  [Laughter.] 

The  Senator  talks  about  the  bullion  value  as  though  that  had  any- 
thing whatever  to  do  with  the  value  of  the  dollar.  I  have  attempted 
to  demonstrate  that  the  material  that  was  in  the  dollar  has  nothing 
whatever  to  do  with  it.  Let  me  illustrate.  Suppose  the  entire  sup- 
ply of  silver  of  the  world  to-day  were  $60,000,000.  Suppose  the 
law  limited  the  coinage  of  it  to  $58,000,000,  and  every  dollar  coined 
was  at  par  with  gold.  Suppose  there  were  a  demand  for  half  a 
million  dollars  of  silver,  to  be  used  in  the  arts,  and  that  the  remain- 
der ($1,500.000)  of  uncoined  silver  were  barred  from  the  imperial 
money  use.  That  supposes  a  supply  of  $2,000,000  left  after  satis- 
fying the  requirements  for  coinage,  and  supposes  only  half  a  mil- 
lion dollars'  demand  for  use  in  all  the  arts.  In  that  case  there 
would  be  a  $2,000,000  supply  bearing  down  a  half  million  dollars' 
art  demand,  or  a  proportion  between  supply  and  demand  of  4 
to  1.  Suppose  that  under  those  circumstances  silver  bullion  went 
to  50  cents  an  ounce.  Would  the  Senator  then  say  that  50  cents  an 
once  was  the  value  of  the  $58,000,000,  and  all  the  rest  of  the  coined 
silver  of  the  western  world,  while  by  coining  another  million  and  a 
half,  which  would  be  nothing  to  a  country  like  this,  all  the  silver 
would  be  at  par  with  gold  ?  Every  ounce  of  silver  coined  in  Europe 
and  the  United  States  is  at  par  with  gold,  a  thousand  or  twelve  •* 
hundred  million  dollars  of  it  to-day  in  France,  $200,000,000  in  Ger- 
many, $370,000,000  of  it  here.  We  are  not  dealing  with  the  price  of 
silver  bullion,  that  portion  of  silver  that  is  deprived  of  its  imme- 
morial use  as  money.  We  do  not  say  what  the  commodity  demand 
for  silver  may  make  that  worth.  Such  a  consideration  has  no  bear- 
ing whatever  on  the  value  of  money. 

I  will  suppose  that  in  some  one  county  of  the  United  States  a  law 
were  passed  that  the  wheat  grown  in  that  particular  county  should 
have  no  right  to  go  through  the  grist-mill,  and  that  that  wheat,  as 
it  might  very  naturally  do,  being  deprived  of  use,  fell  to  one-half  the 
price  of  the  wheat  grown  elsewhere  in  the  country.     Would  the 
price  of  the  wheat  of  that  one  county  thus  under  interdiction  and 
denied  the  grist  be  a  fair  gauge  by  which  to  measure  the  value  of 
the  entire  wheat  crop  of  the  country  ?    Manifestly  not.     All  we  have  ; 
to  do  is  to  take  up  the  little  "  slack"  of  silver,  and  all  of  it  will  at  ' 
once  be  at  par  with  gold ;  then  weshall  hear  no  more  about  the  "  com-  I 
modity  value"  of  silver.   That  is  the  contention  that  the  bimetal-  I 
lists  make. 

Mr.  HEARST.     It  will  be  $1.29. 

Mr.  JONES,  of  Nevada.  It  will  be  $1.29  an  ounce  in  one  week — 
in  three  days — in  fact  the  very  moment  you  give  it  back  its  ancient 
right  of  coinage  and  restore  to  it  its  full  money  power.  You  coin  of 
gold  all  that  is  brought  to  the  mint,  and  you  deny  to  a  certain 
portion  of  silver  that  same  long-established  privilege,  and  then  you 
measure  the  value  of  the  whole  supply  of  silver  by  that  of  the  little 
fraction  that  is  not  coined,  and  which  therefore  has  to  find  a  market 
as  a  commodity. 

Mr.  McPHERSON.  Then,  if  the  Senator  will  permit  me,  he  nec- 
essarily proposes  that  the  Government  of  the  United  States  shall  take 
up  all  this  "  slack,"  as  he  calls  it,  in  the  surplus  quantity  of  silver 


94 

ami  shall  use  it  in  the  coinage.    The  mints  of  Europe  being  closed 

the  coinage  of  silver,  there  is  no  other  place  where  it  will  be 

coined.     Now,  if  tin-  Government  of  the  United  States  should  use  all 

.i-plus  silver  in  the  country,  which  lias  simply  forced  the  price 

down  MHO-  \\c  leiiM'iieti/ed  silver  in  If?.-!  more  than  'JO  percent. 

Mr.  JONKS.  of  Nevada.     Gold  has  risen  '£>  per  cent. 

Mr.  IfoPHEBdON.  Then  I  think  the  Senator's  argument  is  upon 
this  idea  and  upon  this  plan,  that  after  wo  are  upon  a  (silver  I>;IMS. 
as  we  should  be  most  assuredly,  there  would  be  no  inequality  in  the 
in«i:>  M«  it  would  be  all  sil\ 

i"  Nevada.     And  no  inequality  between  it  and  gold. 

Mr.  M«  1'HEKSON.     Certainly  not,  because  there  would  be  no  gold 
in  circulation.    But  let  me  ask  the  Senator  another  question.   While 
D  use  his  short-legged  silver  dollar  for  the  payment  of  debts, 
when  he  conies  to  make  a  new  obligation  would  not  the  price  of  the 
assume  a  price  equal  to  the  difference  between  gold  and  silve:  t 
In  other  words,  while  you  can  use  a  debased  currency  for  the  pay- 
ment of  debts,  if  a  legislative  decree  requires  that  you  shall  accept 
a  can  not  use  it  for  any  other  purpose. 

Mr.  JONES,  of  Nevada.  I  can  not  understand  the  Senator.  We 
hav«  not  provided  any  "  short- legged  "  dollar.  The  Senator  is  as- 
suming a  good  many  facto  and  attempting  to  adjust  me  to  them.  I 
ask  the  Senator  to  wait  until  he  has  heard  my  argument,  and  I 
iuvite  the  Senator  then  to  make  reply  to  it. 

r  Mr.  McPHERSON.  I  am  sorry  tha*t  I  interfered  with  the  Senator. 
'  Mr.  JONES,  of  Nevada.  It  was  no  interference  on  the  part  of  the 
Senator,  except  that  I  can  not  separate  the  Senator's  questions  from 
the  argument  and  assumptions  that  he  makes.  As  to  the  outflow  of 
gold,  as  I  have  said,  it  would  take  a  long  time  for  oven  $400,000,000 
of  it  go.  The  amount  of  gold  driven  out  would  tend  t<>  raise  prices 
abroad  by  making  money  more  plentiful  there,  and  so  check  the  ont- 
ilou  of  gold  from  hen-.  'When  Senators  speak  about  $4-00,000,000  of 
gold  being  withdrawn  from  circulation  hero  a  question  that  in  a  little 
curious  arises.  What  are  these  people  who  own  it  going  to  do  with 
that  gold  after  they  have  withdrawn  it  from  circulation  f  Are  they 
going  to  invest  it  in  (ireat  I'.ritain  ?  Are  they  going  to  invest  it  in 

•  •  T    Are  they  going  to  the  Cape  of  Good  Hope,  to  invest  it  f    If 
they  are  they  will  reverse  the  policy  that  English  capitalists  are  pur- 
suing now  and   have  been  pursuing  for  years — bringing  their  gold 
over  here  for  investment.     The  Senator  tells  us  that  gold  istodis- 

r  from  circulation.     What  will  the  owners  do  with  itt    Where 
and  in  what  are  they  going  to  invest  it  t 

Mr.  Mcl'HEKKON.     It  will  be  held  fora  premium. 
Mr.  .!<>M  nla.     Hut  who  will  buy  it  al  a  premium  f    Who 

. t  at  allf     For  what  purpose  is  it   nee-led  ?     Who  is  going  to 

Giy  any  premium  tor  it  \     Nobody  is  "  shori  "  <>n   it.  and  there  is  no 
an\ body  to  ha 

.cut,  nobody  wan;-,  it  enough    i..   ^ive  a   premium  for  it. 

It  is  only  worth  what  is  daily  paid  in  the  mai  i.et-,  of  the  world  ami 

•'i  pay  .1  premium  for  it.      It     -  -\ith  which 

Jiten  the  j»eople  who   demand  reform  in  the,  currency  of  this 

coiiiitiN.      I.-  t  them  withdraw  their  gold. 

I  tell  the  ."M-nator  it  is  not  the   men  who  hoard   the  gold  in  \ 
who   maintain    or   promote   the    pi..-  :ln-  country,  but  tin- 

-  in  the  wheat-fluids  and:  mi  the  farms  of  the  country,  the  men 

MI   the  planing   mill-.,  the   IOI^CH,  the  Inrnaees.  the  fao- 
toriec,  and  in  all  our  institution*  of  industry.     It  is  they  that  bring 


95 

us  our  prosperty,  and  not  these  people  who  are  gambling  for  pre- 
miums ou  gold. 

Let  them  gamble  among  themselves;  let  who  lose  and  let  who  win, 
the  people  care  nothing.  The  people  of  the  United  States  are  going 
to  institute  a  money  that  shall  install  and  maintain  justice  as  between 
the  citizens  of  this  country,  and  they  will  not  be  impeded.  I  can  tell 
the  Senator  that  neither  his  party  nor  the  Republican  party  will  ever 
impede  the  march  that  this  great  country  is  about  to  make — the  first 
in  the  world,  I  am  glad  to  say — in  adjusting  to  the  demands  ot  in- 
dustry and  commerce,  that  great  instrument,  money,  the  non-ad- 
justment of  which,  as  I  have  already  stated,  has,  in  my  belief, 
caused  more  misery  than  was  ever  caused  by  war,  pestilence,  and 
famine. 

But  to  resume  at  the  point  where  I  was  interrupted: 

The  gold  going  out  would  tend  constantly  to  restore  the  equilib- 
rium between  our  prices  and  those  of  the  gold-using  countries, 
making  the  proportion  of  the  gold  outflow  each  year  less  than  that 
of  the  year  before.  If  there  be  included  in  this  computation  the 
remaining  $100,000.000  of  gold,  which  would  remain  after  the  out- 
flow of  the  $600,000,000,  we  shall  be  compelled  to  come  to  the  con- 
clusion that  the  time  when  our  stock  of  gold  can  be  driven  out  will 
be  almost  indefinitely  postponed. 

Bnt  even  should  all  our  gold  go  by  reason  of  the  remonetization 
of  silver,  it  will  not  be  to  the  injury  of  the  gold  standard,  but  to 
its  great  advantage,  and  to  the  equally  great  advantage  of  the 
masses  of  the  people,  as  well  of  this  country,  which  the  gold  may 
leave,  as  of  all  countries  to  which  it  may  go.  It  will  make  the 
"gold  standard"  consistent  with  the  prosperity  of  the  countries 
maintaining  it.  But  instead  of  preserving  the  gold  standard  of  to- 
day, which  is  a  standard  of  wrong,  it  will  inaugurate  a  gold  stand- 
ard that  will  approximate  to  a  standard  of  justice. 

The  new  "  gold  standard  "  that  would  be  established  by  the  out- 
flow of  our  gold  would  be  a  standard  of  prices  resulting  from  the 
influx  into  England,  France,  and  Germany,  the  principal  gold-using 
countries  of  Europe,  of  more  than  $600,000,000  of  money. 

So  considerable  an  addition  to  their  money-stock  would  raise 
prices  in  those  countries,  and  by  remaining  there,  would,  with  the 
current  production,  which  we  could  spare  to  them,  tend  to  maintain 
prices  at  a  steady  level.  Such  a  condition  would  be  an  inestimable 
boon  to  the  overburdened  masses  of  Europe,  and  their  prosperity 
would  not  be  attained  at  the  expense  of  the  people  of  the  United 
States.  We  could  well  afford  to  let  gold  go,  since,  by  the  coinage 
of  silver,  our  own  money  volume  would  not  be  reduced.  The  rise 
of  prices  which  it  would  effect  in  Europe  would  not  only,  as  I 
have  stated,  secure  better  prices  for  our  exported  goods,  but  would 
undoubtedly  enable  us  to  maintain  prices  here  at  a  substantial  parity 
with  those  of  Europe — that  is  to  say,  with  those  of  the  new,  more 
rational  and  more  beneficent  gold  standard  which  would  be  estab- 
lished by  the  full  remonetization  of  silver  in  this  country. 

PBACTICALLY  NO  GOLD  MOSEY  IN  THE   UNITED  STATES. 

But,  aside  altogether  from  this  consideration,  the  gold  that  we 
already  have  is  really  a  surplus — it  is  practically  a  dead  and  useless 
article.  Gold,  Mr.  President,  can  not  with  entire  truth  be  said  at 
the  present  time  to  form  any  part  of  the  money  of  this  country. 
Who  but  a  bank  clerk  ever  sees  a  go'd  piece  ?  With  the  exception 
of  a  few  million  dollars  on  the  Pacific  coast,  gold  is  not  really  in  cir- 
JONES 


eolation  in  this  country.     It  is  performing  no  useful  function  what- 
soever.    While  I  am  engaged  in  delivering  these  remarks  I  venture 
to  say  no  Senator  within  the  sound  of  my  voice  has  in  his  pi" 
single  gold  coin  of  any  denomination  whatever,  or  any  paper  repre- 
sentative of  one. 

This  is  the  answer  to  the  fear  expressed  by  some  Senators  that 
when  those  who  hold  gold  shall  observe  the  enlargementof  the  money 
circulation  by  the  issue  of  the  proposed  Treasury  notes  they  will 
be  likely  to  hoard  it.  They  are  already  hoarding  it.  Every  body 
knows  that  that  is  about  all  that  gold  is  used  for  in  this  country. 
It  ia  hardly  possible  for  it  to  be  hoarded  to  any  greater  extent  than 
it  is  at  the  present  time.  So  little  is  this  metal  in  circulation  that 
I  do  not  deem  it  any  exaggeration  to  say  that  there  are  millions  of 
people  in  the  United  States,  "native  here,  and  to  the  manner  born," 
who  have  never  in  all  their  lives  seen  a  gold  coin. 

How  absurd,  then,  is  the  claim  that  any  loss  is  to  be  suffered  by 
the  alleged  future  hoarding  of  gold,  or  that  any  calamity  can  occur 
to  65,000,000  people  by  the  disappearance  of  that  which  has  long 
since  disappeared. 

THE  ARGUMENT  BASED  OX  OUR  BALANCE  OP  TKAM  . 

One  of  the  staple  arguments  of  the  advocates  of  the  singl< 
standard  is,  that  if  our  stock  of  gold  were  greatly  reduced  we  should 
be  unable  to  make  payments  to  foreign  countries  in  case  tin-  balance 
of  trade  turned  against  us.     It  is  only  through  an  excess  of  imports 
over  exports  that  gold  could  go,  and  this  country  now  prodv 
nearly  all  article*  almost  all  that  it  consumes.     With  the  exception 
of  i  v.  o  years  there  has  not  been  a  balance  of  trade  against  us  for 
fourteen  years,  as  the  following  table  will  show: 

Value  of  mrn-litindite  importnl  into,  and  exported  from,  the  l'i 
from  167(3  to  1889,  inclusive;  also  annual  wess  of  imports  or  of  ex- 
port*— specie  values. 


•  tiding 
June  30  — 

Total  ex- 
port*. 

Total  im- 
ports. 

Total  export* 
and  ini|M>rin. 

Kxrwn  ot 
:  *  over 
imports. 

i:\.  <•.•<•.  .it 

import* 
port*. 

1878  ... 

Dollan. 
540,  384,  071 

Dollan. 
460  741  190 

Dollan. 
1,001  125,861 

Dollan. 
70,643  481 

Dollart. 

1877  ... 

r,  tj  -i?-,  :'j) 

1,  053,  798,  846 

1878 

i.-ii  -',-,  7'.-; 

lira 

710  430  441 

445  777  775 

264,661  C06 

IBM  

r  ;:,  i.  ;-  »•.:..- 

t.'.  7  '*.M   7l''i 

1  503 

1881  ... 

902  877  846 

01  ••  f,.;|  i;v- 

1  545  041,974 

750,  542.  267 

7lM  i,.;;t  :,74 

•j  .  '.•<>  •  ..-.: 

r      .     -..'•     411  ' 

-0  014 

loo  i; 

71     :  .  ]     r,,  ;• 

ITJ   '-"7  ::"  ' 

1  319 

104  602  4.'« 

1886  ... 

670,  524,  830 

1  .'.  IM  i::>. 

1  314,960  966 

!--:  ... 

716,  I/- 

an  -:i  i  TU* 

18&8  

''.''•      '.!    |  .7 

28,002  607 

18»... 

74J  .       .;:. 

|   7:i       '77 

This  table  shows  that  while  for  last  year  there  was  a  balance 
agftinnt  us  of  12,730,277,   andti  :  >ie  ..t    -  :.,i  al! 

former  years  from  1887  back  t<>  1-71  the  habiicc*  \\-cn-  in  our  favor- 
all  the  "way  fn.m  $23,000,0< '  In  1--7  to  0H6,<  00,000 in  I  —  I.  Hut  tho 
total  want  of  significance  so  far  as  the  movement  of  gold  is  concerned 


97 


attaching  to  any  figures  showing  a  balance  of  trade  against  the 
United  States  will  be  seen  by  an  analysis  of  the  figures  for  any  one 
year.  Let  us  take  for  example  the  imports  and  exports  for  1889  and 
analyze  them  by  countries. 

I  now  present  a  table  in  which  I  place  in  one  group  the  gold-using 
countries,  and  in  another  the  silver  and  paper-using  countries. 

Exports  and  imports  of  the  United  States  to  and  from  the  various  gold- 
using  and  silver-using  or  paper-using  countries  of  the  world  for  the 
fiscal  year  ending  June  30,  1889. 


Countries. 

Exports. 

Imports. 

Gold-using  countries: 

$42  141  156 

$43  009  473 

23  345,  219 

9  816  435 

3,  903,  937 

846  901 

46  120  041 

69  506  618 

68  002  594 

81  742  546 

382  981  674 

178  '69  067 

165  079 

988  923 

Italy                      -  

12  C04  848 

17  992  149 

15  062  939 

10  950  843 

3  266  814 

1  282  556 

11  946  348 

4  636  661 

2  615  569 

2  983  319 

Turkey                                  

4  687  731 

2  936  213 

895  344 

'    12  321  980 

5  998  211 

Silver  and  paper  using  countries: 
Austi  la-Hun  gary  

72t>  156 

7  642  297 

Russia.  -  

8,  364,  545 

2  985  631 

11  486  896 

21  253  601 

4  325  923 

8  414  019 

Hawaii  

3  375  661 

12  847  740 

Argentine  Republic  

9  293  856 

5  454  618 

Brazil  

9  351,081 

60  403  804 

Chili  

2  972  794 

2  622  6°5 

780  835 

314  032 

Colombia  

3,  821  017 

4  263  519 

Uruguay  

2,  192,  848 

2  986  964 

3  738  961 

10  39°  569 

11  691  311 

52  130  623 

Hay  ti  

5  340  270 

5  211  704 

Porto  Rico  

2,  224  931 

3,  707  373 

British  West  Indies  

10,  4e3,  973 

20,  723  268 

Dutch  West  ludies  ,  

887,  778 

654,  320 

China    

6  477  512 

18,508  678 

India,  British  

4.  330,  413 

20  029  601 

India,  Dutch  

2,  249,  604 

5,207  254 

4  619  985 

16  687  992 

By  this  table  it  is  seen  that  the  only  gold-using  countries  having 
a  balance  of  trade  against  us  are  Canada,  $868,317;  France, 
$•23,446,577;  Greece,  $823,824;  Germany,  $13,739,952;  Italy, 
$5,387,301;  Sweden  and  Norway,  $367,850;  Turkey,  $4,687,731— 
making  a  total  balance  against  us  in  gold-using  countries, 
$49,321,452 — against  which  we  have  a  balance  in  our  favor  with 
Great  Britain  alone  of  over  $200,000,000. 

The  balance  against  us  in  favor  of  all  the  silver  using  countries 
could  of  course  be  readily  settled  in  silver;  and  by  carefully  noting 
the  figures  of  the  table  last  given  it  will  be  seen  that  it  is  in  the  last 

7  « 


98 

degree  improbable  that  there  will  ever  be  a  balance  of  trade  against 
us  in  the  gold  using  countries,  taken  as  a  whole. 

Hence  it  is  clear  that  if  we  had  no  gold  at  all  we  could  readily 
settle  all  foreign  balances  that  might  lie  against  us. 

Nations,  however,  ultimately,  and  on  the  whole,  square  their  ac- 
l  counts  with  commodities.     Every  nation  must  buy  what   it  v 
I  with  its  own  products.     In  this  country  .especially  have  we  nothing 
I  to  fear,  because  any  temporary  balance  against  us  could  alv.  :i 
/  met  liy  the  yield  from  our  own  mines.     No  country  has  any  difficulty 
by  reason  of  any  difference  in  money  systems  in  buying  what 
other  nation  has  to  sell. 

view  is  supported  by  all  writers  on  political  economy.  I  need 
quote  but  one.  Professor  Cairnes,  professor  of  political  economy  in 
the  University  College  of  London,  in  his  able  work  on  "  Some  un- 
settled questions  in  political  economy"  (1674),  says: 

It  appears  to  me  that  the  influence  attribut  eel  by  many  able  writers  in  tip 
States  to  the  depreciation  of  the  paper  currency  as  regards  its  effect*  on  the  im  • 
eign  trade  of  the  country  is,  in  a  1:1  >  at  decree,  purely  imaginary.     An  advm 

the  scale  of  prices.  m*a*itred in  gold,  in  a  country,  if  not  shared  by  other 

will  at  on  -.ireign  trade,  giving  an  impulse  to  importation!*  and  . 


•  •\]>oitittioii  of  all  commodities  other  than  gold.    A  similar  efl'ect  is  very 
•I  by  American  writers  to  tho  action  < 


•r.t,  d  by  American  writers  to  the  action  on  prices  of  the  greenback 


may  racily  be  shown  that  this  is  a  complete  illusion.     Foreigners  <lo  not 
send  their  product*  ro  the  Knited  States  to  take  back  greenback*  in  w 
The  return  which  they  look  for  is  eil  liet  -gold  or  the  romiuoilitiesol  the  con  in 

.ia\e  ]  i-i-n  in  price  in  proportion  as  the  paper  money  baa  been  depi> 
how  should  the  advance  in  paper  prices  constitute  an  inducement  for  them 

••is  thitherf    The  nominal  gain  in  greenbacks  on  the  importation  is  ex- 

.  1>\  the  nominal  loss  when  those  greenbacks  came  to  be  cm 
into  void  or  commodities.    The  gain  may,  in  particular  cases,  exceed  the  lo- 
if  it  does,  the  loss  will  also,  in  other  cases,  exceed  the  gain.    On  the  whole,  and  on 
an  average,  they  can  not  but  be  the  equivalents  of  each  other. 

Mr.  President,  the  best  place  in  the  world  where  we  can  have  gold 
is  not  in  the  Treasury  of  the  United  States,  not  in  any  suh-ti. 
but  in  circulation,  if  not  in  our  own  country,  then,  in  the  !•• 
countries  where  our  .surplus  products  are  sold.    That  is  where  gold 
would  do  us  the  most  good  by  making  money  plentiful  and    pricf- 
••ondin^ly  high.     It  does  us  no  good  here  whatever,  locked  up 
as  it  always  is,  and  doing  rone  of  the  work  of  money,  but  simply  re- 
duces to  tiie  minimum  the  tax-paying  and  debt-pay  in^  power  of  our 
wheat-  and  cotton-growing  communities. 

An  unjust  money  should  not  be  tolerated,  whatever  tin-  material  of 
which  it  may  b«i  composed,  and  the  people  of  this  country  will  not 
They  do  not  fear  the  outflow  of  gold.  If,  in  order  to  r.-- 
taiu  it,  they  must  continue  to  lose  as  they  have  been  losing  for  the 
past  (itteen  \ears,  they  will  favor  its  going,  and  raise  a  shout  of  joy 
when  it  does  go.  With  a  perfect  money  system  in  our  own  country 
the  range  of  our  domestic  prices  would  continue  stalile  and  equitable 

_ard  to  the  prii  •  :  n  eoinit  ries.     Onrloreie,: 

would  tak.  -.•!!,  and  whate\  er  the  balances  might  he,Ih--y 

would   l>e  much  oltener  in  our  favor  than  against  us,  ami   in  reality 
Concern  only  the   importing  merchant    and    not    the  .  nt  or 

the  people  of  the  i'ii  B  difficulty  of  gold-luring 

tries  to  get  our  money,  in  which  to  pay  us  the  balances  the\ 

owe  ns,  would  lie  much  greater  than  our  dim'culty  in  o. 
A  Inch  to  pay  them  the  occasional  balances  we 
them. 

more  serious  question,  (if  it  be  a  seri»  •  on  at 

all,  which  I  deny)  is  hu\v  •   our  money,  not  how  we 


99 

shall  get  theirs.  As  the  balances  would  be  for  the  most  part  in  our 
favor,  it  is  for  them  to  take  such  steps  as  may  be  necessary  in  order 
to  pay  us.  But  there  is  no  just  reason  to  apprehend  di fficulty  in 
either  case.  A  great  country  like  the  United  States  will  have  no 
trouble  in  buying  the  money  of  any  other  country  at  equitable 
rates— at  rates  regulated  by  the  purchasing  powers  of  the  moneys  of 
the  two  countries,  respectively. 

No  country  in  the  history  of  the  world,  having  a  money  local  to 
itself,  has  ever  found  the  slightest  difficulty  in  buying,  upon  ratios 
determined  by  the  relative  purchasing  powers  of  the  two  kinds  of 
money,  a  sufficient  amount  of  foreign  exchange  (which  simply  means 
the  money  of  another  country)  to  meet  all  adverse  balances  of  trade. 

While  earnestly  advocating  the  full  remonetization  of  silver  and 
the  maintenance  in  this  country  of  a  money  volume  sufficient  to  in- 
sure a  steady  level  of  prices  and  an  unchanging  value  in  the  money 
unit,  I  entirely  disclaim  any  desire  for  an  inflation  of  the  currency. 
My  contention  is  that  without  silver  we  can  not  keep  prices  from 
further  decline,  and  can  not  have  enough  money  to  serve  the  grow- 
ing needs  of  population,  industry,  and  commerce. 

At  the  same  time  I  can  not  refrain  from  expressing  the  conviction 
that,  as  between  inflation  and  contraction,  no  careful  student  of  his- 
tory and  of  economic  science  can  for  a  moment  hesitate  in  deciding 
that  the  evils  inflicted  on  society  by  contraction  have  been  longer 
in  duration  and  infinitely  greater  in  degree  than  any  that  have  ever 
resulted  from  inflation.  Daring  all  periods  in  which  there  has  been  a 
generous  increase  in  the  money-volume  of  a  country  or  of  the  world, 
activity  and  prosperity  have  been  its  accompaniment.  I  challenge 
the  citation  of  an  instance  to  the  contrary. 

With  a  volume  of  money  increasing  at  a  rate  sufficient  to  meet  the 
demands  of  a  growing  population,  and  especially  if  the  money  be 
such  as  will  not  leave  the  country,  but,  under  all  circumstances, 
will  remain  in  it,  to  sustain  prices,  preserve  equities,  and  reward 
labor,  no  country  with  a  proper  coordination  of  its  industries  can 
be  otherwise  than  prosperous. 

The  property  of  mobility — of  fluidity — which  is  so  much  lauded  in 
gold,  is  precisely  the  property  least  to  be  desired  in  the  money  of  a 
country,  if  that  property  of  mobility  or  fluidity  is  to  keep  alter- 
nately bringing  money  into  and  taking  it  out  of  the  country,  disturb- 
ing prices  and  disarranging  equities.  When  it  comes,  if  it  enters  into 
circulation,  prices  rise ;  when  it  goes,  prices  fall,  and  thus,  instead  of 
having  a  steady  and  level  platform  of  prices  on  which  the  trade  and 
industry  of  the  Republic  may  rest,  like  the  firm  and  level  platform 
of  liberty  upon  which  all  our  citizens  stand,  we  whose  business  it  is 
to  "  see  that  the  Eepublic  take  no  harm,"  furnish  our  people  with  an 
"  inclined  plane  "  of  finance  on  which  all  their  business  must  be  con- 
ducted. Men  buying  this  month  at  the  elevated  end  of  the  plat- 
form find  themselves  selling  next  month  at  the  depressed  end. 

Whenever  in  the  history  of  a  country  there  has  be«n  least  reliance 
on  international  money  (gold)  and  more  reliance  on  merely  national 
money  (even  of  paper  when  reasonable  limits  were  placed  upon  its 
quantity),  prosperity  has  been  everywhere  present.  I  need  not  recall 
to  the  minds  of  Senators  the  wave  of  prosperity  that  swept  over 
this  country  when  it  was  without  any  international  money  and 
resorted  to  the  "greenback"  currency. 

When,  as  a  result  of  the  Franco-German  war,  France  was  deprived 
of  international  money,  suspended  specie  payments,  and  resorted  to 
a  properly  limited  paper  currency,  her  progress  was  unbounded. 


100 

Xo  period  in  the  history  of  Great  Britain  can  compare  f..: 

-!>erity,  or  achievement,  with  the  twenty  years  preceding  l-li'.. 
whc:  .ynicuts  wen-  suspended,  and  during  which  perioil,  as 

testified  to  by  witnesses  beforo  the  si-eivt  committee  of  Parliament, 
the  discount 'rate  of  the   Bank  of  England  did  not  sutler 
change  ;  whereas  from  that  period  t<>   1.-17    the  rate  was  ch:tn_ 

•  •n  times,  and  from  1*47  to  Iei74  as  many  as  -J7  i  times,  the  ilno 
tnations  being  sometimes  of  the  most  violent 'character. 

When  gold  threatens  to  leave  Great.  Britain  the  rate  of  discount 
at  the  Hank  of  England  is  raised,   with  the  view  of  disroui;. 

MtiiiL,r,  the  ontllow.     Raising  the   rate  of  discount    is  like 
puttiug  the  brakes  on  a  railroad  train;  lowering  the  rate  is  i: 
letting  oil' the  brakes. 

These  changes  were  not  due  to  any  greater  demand  for  in 
but  to  the  movements  of  gold.     There  was  frequently,  in  the  condi- 
tion of   business,    no  warrant   whatever  for    a    rise    in  the  rate  of 
discount.     The  only  reason  for  it  was  to  prevent  gold  from  perform- 
ing   what    "our    most    conservative    financiers"    denominate, 
"noble"    function    of    "mobility"' — of    "  fluidity  " — namely.     : 
function  of  gnin:;  "where  it  was  wanted."      This  Junction  uf  go. 
"  wi  \\anted"    is    described    as    ih.-    i^reat    "mission" 

•{old,  and  it  is  assumed  that  it  will  never  be  \\..nied  at  more  than 
one  place  at  a  time.  Yet  hear  what  the  chancellor  of  the  exchequer 
of  Great  Britain  said  a  few  days  ago  in  the  House  of  Comnic 

I  admit  that.au  interested  in  the  commerce  an<l  monetary  HVfttetn  of  thin  country. 

.1  kind  oi'.-li.inic  that  ou  the  occasion  of  £2. 000.000  or  £3, OOO.Oim  of  _..,,!  I.. 
taken  from  this  country  to  I'.r.i/.il.  or  any  nth  -r  country,  it  should  in 
hare  the  effect  of  causing  a  monetary  Miami  throughout  tin-  conn; 
the  chancellor  of  the  rn-ln-iiiu-r  in  the  House  of  Commons.  April  18,  1890.) 

This  is  a  suggestive  admission,  from  so  well-informed   a  sour. 
To  the  operation  of  tlie  single  jjold  standard.     1  cinnmend  it  toth 
who  would  cirenmsrrilif  and  hamper  the  prosperity  of  this  country 
by  making  jrold  alone  the  standard  of  all  va'  . 

I  have  thought  it  necessary,  Mr.  rn-sident,  to  state  what  I  eoi., 
to  be  the  true  principles  of  the  science  of  mom  v.  the  principles  that, 
with  the  progress  of  time  and  growth  of  intelligence,  must  pre\ 

.•  orl.l  over  :  liei-anse.  without  a  clear  understanding  of  the  rela- 
tion which  the  quantity  of  money  in  a  country  bears  to  the  prosperity 
and  happiness  of  its  people,  there  would  be  no  jnstilicat  ion  for  an 
add.'  :.  gold,  or  any  other  form  of  money  to  t!i.- 

itity  already  in  circnlat  ion.     It  I  lie  value  of  money  depends 
.  then,  as  long  as  the  world  adheres  to  the  automatic  the 

ition  is  that  all  the  silver  produced  from  all  t  he 
orlil  should  be  transmuted  into  coin  ;   and  even  then, 
if  the  wants  of  the  world  cont  inue  to  iuerease  as  they  have  !•,•,:, 

i  i|  nest  inn  of  time,  and  that  n»t  far  distant,  when 
the  •  "I'l'lv  of  both  metals  will  be  iiisuth'eieiit  to  ipaintaiu 

;  :me  tran-;i,  i  ;,,n>. 

v  or  Id  having  de,  i.-ec  I  to  ^taml  by  the  automatic  system  wo  are 
now  .  ;h  tin-  question  as  a  practical  one. 

The  onlv  relief  that  can  be  had  i-  to  ad  In  -i  e  ,t  i  ictl  y  to  that  system. 
and  give  it  full  >eope.      Heniove  nil  legislate  ••  n-striet  ions  and  let  : 

:itofull  the  precious  metals  tl...  led 

••  mines. 


101 

THE  WORLD'S  SUPPLY  OF  GOLD  AND  SILVER. 

Since  for  thousands  of  years  the  world  recognized  both  silver  and 
gold  as  money,  can  anybody  tell  what  has  happened  to  render  one 
of  them  unfitted  for  the  money  use  ? 

No  argument  based  on  fluctuations  in  the  current  supplies  of  either 
of  the  metals  can  militate  against  the  use  of  both  as  money.  The 
fluctuation  in  the  annual  yield  of  both,  taken  together,  is  much  less 
violent  and  less  frequent  than  the  fluctuation  of  either  taken  separ- 
ately. By  the  use  of  both,  society  has  much  greater  security  against 
the  evil  of  an  insufficient  money  volume.  While  a  large  yield,  now 
of  one,  and  again  of  the  other,  has  taken  place,  there  is  no  instance 
in  the  history  of  the  world  of  an  extraordinary  yield  of  both  occur- 
ring simultaneously,  except  in  the  single  instance  of  the  first  discov- 
ery of  the  mines  of  America.  When  the  gold  mines  have  been  yield- 
ing largely,  there  has  been  no  special  increase  of  silver,  and  during 
the  period  when  silver  has  been  produced  in  comparatively  large 
quantities  the  gold  mines  have  been  less  productive. 

This  will  be  illustrated  by  the  following  table  showing  the  yield  of 
both  gold  and  silver,  from  the  discovery  of  America  to  the  present 
time. 


Annual  average  production  of  the  precious  metals  throughout  the  world 
from  the  discovery  of  America  to  1872. 

[From  Director  of  United  States  Mint.] 


»                Periods. 

Gold. 

Silver. 

1493  -1520,  average  for  each  vear  

$3,  855,  000 
4,  759.  000 
5,  657,  000 
4,  546,  000 
4,  905,  000 
5,  662,  000 
5,  516,  000 
5,  829,  000 
6,  154,  000 
7,  154,  000 
8,  520,  000 
12,681,000 
16,  356;  000  , 
13,  761,  000 
11,  823,  000 
11,  815,  000 
7,  606,  000 
9,  448,  000 
13,  484,  000 
36,  393,  000 
131,268,000 
136,  946,  000 
131,728,000 
127,  537,  000 
113,  431,  000 

$1,  953,  COO 
3,  749,  000 
12,  950,  000 
12,  447,  000 
17,  409,  000 
17,  538.  000 
16,  358.  000 
15,  223,  000 
14,  006,  000 
14,  209,  000 
14,  779,  000 
17,  921,  000 
22,158,000 
27,  128,  000 
36,  534,  000 
37,  161,  000 
22,  474,  000 
19,  141,  000 
24,  788,  000 
32,  434,  000 
36,  827,  000 
37,611,000 
45,  764,  000 
55,  652,  000 
81,  849,  000 

1521-1544  do  

15-45-1560  do  

15C1-1580  do  

1581-1600  do  

1601  1620  do  ..            

1621  1640            do 

1641-1660  do  

1661-1680  do  

1681-1700  do  

3701-1720,  average  for  each  year          .       ...  .....  .. 

1721-1740  do  

1741-1760  do  

1761-1780  do  

1781-1800  do  

1801-1810  do  

1811-1820  do  

1821-1830  do  

1831-1840  do  

1841-1850  do  

1851-1855  do  . 

1856-1860  do 

1861-1865  do 

1866-1870  do  

1871-1872  do  

102 


World's  production  of  gold  and  tilrer  for  the  calendar  years  1873  to 
1889,  inclusive. 


Calendar  years. 

Gold. 

Silver. 

Value. 

Fine  ounce*. 

Maiket  value. 

Coining  value. 

1FT3  

$96,200,000 
90,  750,  000 
97,500.000 
103,  700.  000 
111,000,000 
119,  000,000 
109,  000,  000 
100,500,000 
103,  000,  000 
102,000,000 
95,400,000 
101,700,000 
108,400,000 
106,000,000 
105,  300,  000 
109.  900,  000 
118,  800,  000 

63,267.000 
55,300,000 
r,j.  •_•«;•_>.  .  0" 
67,  753,  000 
62,648,000 
73.  476,  000 
74,  250,  000 
74,  791,  000 
78,890.000 
86,  470,  000 
89,  177,  000 
81,597,000 
91,652,000 
93,  276,  000 
96,  189,  000 
109,  911,  000 
125,  830,  000 

$82,120,000 
70,  673,  000 
77.  578,  000 
78,  32-.',  ooo 
75,  '.'40,  000 
84,  644.  000 
83,383,000 
85,636,000 
89,  777,  000 
98,230,000 
!<8.  :».».•,.!  «i  • 
90,  817,  000 
97,584,000 
92,772,000 
94,265.000 
103,316.000 
117,651,000 

$81,  MX),  000 
71,  500,  000 
80.  500.  000 

81,000,000 
95.000.000 
96,  000,  000 
96,  700,  000 
in  -2,  000.000 
111.800.000 
115.  800,000 

10:,.  500,000 

118.  500,  000 

r.'4.  :t68,  ooo 

14'J.  107,000 
162,  690,  000 

1J-74 

1876    

187«  


1878  

1879  

iKj.0   

1(31    

1882  




1885  

18P6  


1B88  

1869  

From  this  table  it  will  be  seen  that  from  1801  to  1820  the  average 
yearly  yield  of  gold  was  $9, 7 10, 5 00;  of  silver,  $36,847,500— four  of 
silver  to  one  of  gold. 

From  1821  to  1840  the  average  yearly  yield  of  gold  was  $11,466,000 ; 
of  >ilver,  $21,964,000 — two  of  silver  to  one  of  gold. 

From  1841  to  1860  the  average  yearly  yield  of  gold  was $85, 150,000; 
of  silver,  $34,826,500— two  and  a  half  of  gold  to  one  of  silver. 

From  1861  to  1880  the  yearly  average  yield  of  gold  \va«  $117 
650;  of  silver,  $68,043.900—  nearly  two  of  gold  for  one  of  si; . 

i  1881  to  1889  the  yearly  average  yield  of  gold  was  $105,500,- 
000;  of  silver,  $122,540,388 — one-sixth  more  silver  than  gold. 

From  those  figure*  it  i»  plain  that   no  co  nt  IIHIOIIH,  extraordinary 
;  silver,  such  as  might  warrant  thefili  ghteM  ft-ar  of  an  unnec- 
essary addition  to  the  money  volume,  is  to  be  expected.   On  the  other 
hand  the  continuous  drain  of  gold  for  ns>-  in    the  arts,  as  dentistry. 
gold  plat*',  jewelry,  gilding,  and  articles  of  decoration  gem-rally,  is 
-ly  encroaching  upon  the  annual  supply. 

l'."t  h  metals  possess  in  common,  and  neither  in  any  different  d 
from  the  other,  all  the  qualities  which  are  recognized  as  nee  esv 
a  commodity  money.     Silver  enjoys  in  an  equal  degree  with  gold  tin- 
quality  of  indestructibility,  of  divisibility,  of  malleabilit  \ .  and  of 
resistance  to  chemical  changes.     The  stock  of  both  existing  in  the 
world  (the  product  of  all  time)    is   estimated  to  be  about  equal,  the 
production  of  the  past  500  years  being  set  down  as — 

Gold $7. '.'4<i.  000. 000 

7.4:15.000.000 

That  silver  mining  h;is  not  proved  exceptionally  urolitaMe  in  this 
country  is  proved  by  the  comparatively  small  number  that  have  en- 
gaged in  the  business.  This  country  has  been  thoroughly  exploicd  in 
the  search  for  additional  mined  without  any  of  great  value  bein 
covered.  The  allurements  of  the  business  lie  in  its  uncertainty  ;  and 
for  the  occasional  prize  that  is  drawn  tliotiNandsof  blanks  an-  found. 
There  is  always  enough  hope  of  result*  to  induce  continued  > 


103 

but  there  is  also  sufficient  doubt  and  discouragement  to  deter  an  un» 
due  number  from  engaging  in  the  business. 

The  mines  of  Mexico  have  been  worked  for  hundreds  of  years ;  and 
up  to  1873  the  business  of  silver  mining  in  that  country  had  all  the 
stimulus  that  a  parity  at  15^  to  1  could  give  to  it.  It  is  not,  there- 
fore, probable  that  any  material  increase  of  output  can  be  expected 
from  that  quarter. 

Conceding,  forthesake  of  the  argument,  the  eventual  possibility  of 
so  superabundant  a  yield  of  silver  as  to  work  injury  and  inequity  to 
the  interests  of  creditors,  is  it  not  manifest  that  it  is  in  the  power  of 
society  at  all  times  to  remedy  the  evil  by  a  limitation  of  the  coin- 
age f  And  on  the  other  hand,  is  it  not  equally  manifest  that  for  an 
insufficient  supply  there  is  no  remedy  ? 

If  great  mountains  of  silver  should  be  discovered,  does  not  Con- 
gress meet  constantly  ?  If  there  should  seem  to  be  too  much,  could 
not  the  coinage  be  readily  limited  to  prevent  depreciation  ?  But, 
on  the  other  hand,  when  we  dedicate  the  monetary  function  solely 
to  one  metal,  of  which  there  is  manifestly  aud  admittedly  the  world 
over  an  insufficient  supply,  where  is  the  remedy  f  What  can  Con- 
gress do  to  enlarge  that  supply  ?  Absolutely  nothing. 


THE  GOLD  USED  IN  THE  ARTS. 


The  Director  of  the  United  States  Mint  a  few  years  ago  estimated 
that  of  the  $100,000,000  gold  annually  produced  from  the  mines  of 
the  world  $46,000,000  are  consumed  in  the  manufacture  of  jewelry, 
gold  plate,  plated  ware,  gold-leaf,  etc.,  and  in  various  processes  of 
dentistry. 

The  single  standard  of  gold,  therefore,  is  maintained  by  the  cred- 
itor nations  in  the  face  of  the  admitted  fact  that  but  $50,000,000'of 
that  metal  are  annually  added  to  the  money  stocks. 

Not  only  is  this  encroachment  of  the  commodity  demand  on  the 
money  supply  becoming  greater  year  by  year,  with  the  growth  of 
population,  but  the  supply  of  gold  from  the  mines  is  itself  becom- 
ing less,  having  declined  from  an  average  of  $137,000,000  between 
1856  and  1860  (the  period  of  greatest  yield  from  California  and 
Australia),  to  an  average  of*  $107,000,000  for  the  past  ten  years. 
Of  the  entire  gold  supply  of  the  world,  nine-tenths  of  it  have  come 
from  placer  mines,  readily  discoverable  and  easily  worked,  because 
requiring  little  or  no  capital.  All  known  fields  of  those  are  practi- 
cally exhausted,  and  there  is  no  reasonable  prospect  of  the  discovery 
of  others.  Hardy,  adventurous,  and  skillful  miners  from  the  United 
States,  and  capitalists  from  all  countries,  have  ransacked  the  world 
in  vain  for  new  fields  of  gold.  Why,  then,  with  the  knowledge  of 
those  facts  before  us,  should  we  discard  from  the  full  money  use  and 
function  the  only  metal  that  gives  to  the  world  any  prospect  of  re- 
lief from  the  money  famine  from  which  civilization  is  now  suffer- 
ing and  from  which,  if  silver  be  not  speedily  restored  to  its  ancient 
use  and  function,  the  world  is  destined  to  suffer  much  more  ? 

If  it  be  conceivable  that  the  demonetization  of  either  metal  were 
necessary,  why  demonetize  that  which  promises  the  greater  and 
more  steady  yield  ?  If  for  any  reason  society  should  decide  that  «ne 
of  the  metals  should  be  discarded,  should  it  not  rather  be  that  one 
which  promises  the  smaller  future  yield,  than  that  which  promises 
the  larger? 

Silver  is  the  money-metal  best  suited  to  the  mass  of  the  people, 
and  to  the  variety  and  character  of  transactions  that  constitute  the 
interchanges  of  daily  life.  The  supplies  of  both  metals  if  united  by 


104 

law,  in  the  full  money  function,  would  have  a  steadiness  of  value 
which  can  not  be  attained  by  either  separately. 

TBKASUBT  NOTES  SHOULD  NOT  BE  REDEEMED   IX  BULLION. 

The  proposition  to  redeem  the  proposed  treasury  notes  in  silver 
bullion  or  in  anything  bat  lawful  money  of  the  United  States  will 
never  meet  the  approval  of  the  people. 

What  the  people  of  this  country  want  is  money,  and  what  they 
should  have  is  money.  These  notes  will  represent  full  value  re- 
ceived, the  evidence  of  which  is  the  bullion  in  possession  of  the 
(rovemment.  When  issned,  they  will  enter  into  circulation.  They 
will  have  to  do  the  work  of  money  among  the  people.  They  prffl 
go  to  make  np  the  volume  of  the  currency.  On  the  basis  of  that 
volume  each  dollar  acquires  a  certain  value,  and  represents  a  given 
amount  of  sacrifice.  On  that  volume,  and  on  those  condition- 
gains  will  be  made,  prices  established,  debts  contracted,  values  ad- 
josted,  and  equities  created.  If  any  portion  of  that  money  be  with- 
drawn from  circulation  (for  that  is  what  "redemption"  nieau- 
without  an  equivalent  amount  of  money  in  some  other  form  he- 
ing  issned  to  take  its  place,  the  circulation  will  to  that  extent  be 
contracted,  every  dollar  in  circulation  will  increase  in  value,  prices 
will  fall,  property-values  established  on  the  basis  of  the  larger  Cir- 
culation will  shrink,  and  equities  will  be  destroyed. 

The  redemption  of  any  number  of  those  notes  in  silver  bullion 
means  the  withdrawal  of  so  many  dollars  of  money  from  circulation 
and  the  destruction  of  so  much  of  the  money  of  the  country.  Money 
.1  thing  that  can  be  destroyed  with  impunity.  It  should  he 
kejit  in  use  among  the  people.  It  is  to  industry  what  the  M 
to  tin- hnnian  body  ;  it  is  the  life-giving  and  life-sustaining  medium. 
The  money  volume  of  a  country  should  not  be  subject  to  frequent  and 
violent  changes.  In  a  new  and  growing  country,  it  should  be  charm •- 
;  liy  that  steady  accretion  that  characterizes  the  increase  in  the 
quantity  of  blood  in  the  human  body  as  it  progresses  from  infamy  to 
maturity.  It  is  no  morfe  unreasoning,  empirical,  or  unseient  il'n-  to  he 
alternately  wit  hdra  wing  blood  from,  and  injecting  blood  into,  a  human 
body  Than  to  be  constantly  contracting  and  expanding  the  money 
volume  ..:'  the  eountry.  And  a.s  activity  of  circulation  of  the  blood 
is  essential  to  the  health  of  the  body,  so  activity  of  circulation  in 
-  indispensable  to  the  well-being  of  society.  The,  possession 
of  ii"  :....•  commodity,  whai.  alue,  will  compensate  a 

country  lor  the  destruction  of  any  considerable  portion  of  its  n 
upon  i  in-  entire  volume  of  which  vast  equities  rest. 

MO5KT  SHOULD  BE  REDEEM  AIH.E  IX  ALL  THINGS. 

-honld  be  redeemed  in  all  things;  not  in  one  thin;;  i 
The  peculiar  characteristic  of  true  money,  that  which  dint  hi- 
lt fr»m  all  other  things  whatsoever  and  constitutes  it  a  prime  t.i.  !•>: 

/.it  inn,  in  that  it  is  at  all  times  redeemable  in  any  tliii 
is  on  sale.    Mej ti ^  an  order  for  property,  it  should  he  redeemed 
•  it  disposable  property  which  the  holder  may  desire. 

>!•»— 

said  Adam  Smith  — 

•  onriderml  M  a  hill  for  a  certain  quantity  of  necenuriM  and  convenience* 
upon  all  thr  KMMOMB  In  th«  neighborhood. 

Any  form  i.tion  of  whose  existence  depends  on 

radeemabilitv  in  one  thing  alone,  can  not  be  money  in  the  full  sense, 


105 

and  whenever  an  urgent  demand  for  real  money  springs  up  the  other 
ceases  altogether  to  be  money. 

The  redemption  of  money  should  be  reciprocal  between  the  Gov- 
ernment and  the  people  and  between  and  among  all  individuals  in 
the  community.  It  should  not  only  be  redeemable  by  the  Govern- 
ment by  acceptance  for  taxes  but  also  redeemable  by  and  among  the 
people  for  all  property  for  sale  and  services  for  hire.  Its  quantity 
should  be  so  regulated  as  that  its  unit  (the  dollar)  should  neither 
increase  nor  diminish  in  value,  and  it  should  be  kept  constantly  in 
circulation,  and  not  be  permitted  to  lie  uselessly  in  the  Treasury. 
Any  other  money  than  this  is  to  a  certain  extent  counterfeit ;  it  is 
false  money,  because  when  most  needed  it  fails  to  be  money  and  has 
to  be  "redeemed"  in  something  else  (gold)  which  can  not  be  got 
except  at  ruinou's  sacrifice. 

It  is  of  the  very  essence  of  money — its  pith  and  marrow  and  proto- 
plasm— that  it  should  be  a  legal  tender,  a  universal  solvent,  the  ul- 
timate of  payment,  and  redeemable,  at  the  prices  ruling,  in  every- 
thing that  is  on  sale.  If  the  volume  of  such  money  be  properly  regu- 
lated, while  there  may  from  time  to  time  be  variations  in  the  prices 
of  particular  articles,  the  general  range  of  prices  will  be  maintained 
practically  undisturbed. 

What  an  absurdity  it  is  for  the  Government  to  put  its  stamp  on  one 
thing  in  order  to  make  it  redeemable  in  another  thing  imprinted 
with  the  same  stamp,  but  which  nobody  wants  except  for  the  pur- 
pose of  getting  a  third  thing  that  could  have  been  got  just  as  well 
without  the  intervention  of  the  second.  As  well  might  he  who, 
wanting  water,  is  given  a  silver  cup  wherewith  to  get  it,  but  on  go- 
ing to  the  spring  is  forbidden  to  drink  until  he  exchanges  his  silver 
cup  for  a  gold  one. 

The  real  reason  why  it  is  insisted  that  all  other  things  than  gold 
shall  be  exchangeable  into  gold  is  that  gold  is  getting  dearer  by  rea- 
son of  decreasing  supply  and  increasing  populations.  The  necessity 
for  convertibility  into  gold  implies  that,  in  ordinary  times,  a  range 
of  prices  higher  than  the  gold  range  will  prevail,  and  when,  by  rea- 
son perhaps  of  increased  activity  of  business,  redemption  comes  to 
be  demanded  prices  are  at  once  precipitated  to  those  of  the  gold 
standard  and  below,  to  the  great  advantage  of  the  creditor  classes, 
who.  as  owners  of  bonds,  may  be  considered  in  the  language  of  the 
stock  exchange  "long"  on  money,  and  to  the  equally  great  injury 
of  the  producing  class,  who,beingin  debt,  may  be  considered  as  hav- 
ing sold  money  "short." 

The  supreme  consideration  is  that  the  money  of  a  country  shall  be 
so  regulated  as  that  prices  may  not  fall  from  any  cause  inhering  in 
the  money  system.  The  value  of  money — in  other  words,  the  sacri- 
fice necessary  to  obtain  it — should  be  no  greater  at  onetime  than  at 
another.  In  order  to  effect  that  object  of  prime  consequence,  to  main- 
tain the  value  of  money  unchanging,  there  should  be  no  hesitancy 
whatever  in  changing  the  material  of  which  it  is  made. 

Nobody  who  has  reflected  on  the  subject  for  a  moment  doubts  that 
what  gave  "value"  or  exchangeable  power  to  the  greenback  was 
not  the  promise  made  on  its  face,  without  date,  to  pay  a.  dollar,  bnt 
the  inscription  on  its  back  which  declared  it  a  legal  tender  for  all 
dues  and  demands,  public  and  private,  except  duties  on  imports.  It 
was  a  misfortune  to  mankind  that  the  words  "  promise  to  pay  "  were 
printed  on  it,  because  by  it  millions  were  led  to  believe  that  the 
"  value"  or  exchangeable  power  resided  in  the  promise  instead  of  in 
the  legal-tender  power  conferred  upon  it. 


106 

There  is  no  object  in  redeeming  in  gold,  except  to  maintain  ^<>ld 
prices,  that  is  to  say,  the  range  i>f  prices  prevailing  in  gold-using 
countries,  and  as  those  pricesare  constantly  trending  downward,  any 
country  that  insists  on  maintaining  tin-  gold  standard  mnstacrept  the 
consequences  in  a  corresponding  fall  of  prices.  The  advocates  of  the 
gold  standard,  in  eflert,  maintain  that  no  matter  to  what  extreme 
may  fall,  we  must  be  content — we  must  bow  in  humble  sub- 
mission to  the  inevitable,  since,  in  their  view,  it  is  mote  \ 
maintain  the  sacredness  of  the  gold  standard  than  to  establish  jus- 
tice, promote  prosperity,  or  to  maintain  equity  in  all  time  transac- 
tions. 

It  is  in  no  way  necessary,  on  account  of  any  intrinsic  or  inherent 
quality  of  gold,  that  we  should  have  that  particular  metal,  and  that 
alone,  for  money. 

•.oa.sted  that  gold  is  a  universal  measure.  Why  is  it  univer- 
sal T  Why  is  gold  accepted  in  every  country  of  the  world  T  Not- be- 
cause the  gold  is  wanted  for  any  quality  inherent  in  the  metal,  but 
because  it  is  an  order  for  property  in  gftid-asing  countries,  such  ., 
laud,  France,  and  Germany,  whose  trade  is  largely  a  foreign  trade. 
At  whatever  rate  gold  will  exchange  in  Knuland,  it  will  exchange  in 
all  countries  having  trade  relations  with  Kngland.  because  "  i-  an 
order  for  goods  in  a  country  with  which  they  are  dealing.  Will  not 
uey  of  this  country  equally,  and  for  like  reasons.  \\  het  her  gold 
or  silver,  have  acceptability  in  every  country  with  which  the  Tinted 
States  have  trade  relations f  Not  for  any  quality  inherent  in  the 
metal,  but  because  it  is  un  order  for  property  in  the  United  States. 
Will  it  n6t  be  willingly  accepted  by  these  who  \\  isli  to  buy  in  this 
country  f 

POSSIBLE  EFFECT  OF  REDBVPTIOX   IS    UULLIOK. 

In  order  to  see  the  effect  of  the  redemption  of  these  Treasm  •, 
in  bullion,  we  have  but  to  look  at  the  possibilities  ,,f  the  situation. 
Snpp.se  there  were  in  the  Treasury  $300,000,000  worth  of  that  bull- 
ion, which,  by  thu  taking  up,  little  by  little,  and  UK. nth  by  month, 
of  the  amount  nut  used  in  the  arts,  would  be  taken  by  the  Yieasury 
at  or  about  par.  Then,  suppose  that  for  any  reason,  such  as  fear  of 
approaehiri,  -••,  $100,000,000  of  the  Treasury  notes 

were  suddenly  presented  tor  redemption,  and    canceled,  and  the  bnll- 

>iiddenly  put  on  the  market,  what  would  it  be  worth?     What 
would  gold  bullion  be  worth  if  it  had  not  the   privilege 
and  if  $100,000,000  of  it,  deprived  of  the  mone\   use,  was  suddenly  put 
on  the  market  f    Can  there  be  a  doubt  that  the  abrupt  output  01  so 

i  quantity  would  have  the  eticct  of  immediately  a  nd  enor- 
mously depreciating  its  value  T  In  the.  case  under  OOOaiden  tion.  the 

M-uld  be  that  the  silver  remaining  in  the  Treasury  would 
not  bring  one-fourth  the  sum  necessary  to  redeem  the  outstanding 
Treasury  notes, so  that  not  only  would  a  heavy  loss  result  to  the 

•Miient,  but,  by  ivason  of  the  sudden   and    seiioiis  conti 

;me,  an  infinitely  greater  loss  would  result  to  all  tho 

Hut  if  it  be  deemed  a  remote  contingency  that   ai  iinary 

t  would  in  that  manner  he  suddenly  taken  from  (lie  Treasury, 

-  another  danger  whiih  can  not    be  put    aside  as  improbable, 

0  l>f  looked  for  with  almost  absolute 

certainty,  and    !••  .m    n  n -movable  and  insiir- 

^teni  of  bullion  redemption. 

:u  London   need,    monthly,  millions 
of  silver  to  make  payments  in  India. 


107 

naturally  want  to  get  it  at  the  lowest  price,  and  it  is  not  to  their 
advantage  to  intensify  the  competition  for  it.  On  the  contrary,  it 
is  to  their  direct  advantage  to  depress  the  price  to  the  lowest  possi- 
ble point. 

As  the  Treasury  of  the  United  States  would  buy  silver  at  the  low- 
est price,  the  London  merchants  would  refuse  to  enter  the  open  mar- 
ket in  competition  with  our  Government  for  its  purchase.  But  no 
sooner  could  the  silver  be  stored  in  the  vaults  of  the  Treasury,  than  the 
agents  of  the  London  merchants  would  appear,  and  before  any  oppor- 
tunity had  offered  for  a  favorable  change  in  the  price  of  the  bullion, 
could  present  as  many  millions  of  these  notes  as  might  suit  their  pur- 
pose, and  receive  bullion  therefor.  A  Secretary  of  the  Treasury  who 
conscientiously  believed  that  it  was  his  duty  to  maintain  the  gold 
standard  at  all  hazards,  would  naturally  feel  compelled — certainly 
it  would  be  in  his  power — to  put  out  whatever  amount  of  bullion  he 
might  deem  necessary  to  accomplish  that  purpose,  even  if  it  all  had 
to  go. 

Thus  the  United  States  Treasury  would  become  the  convenient 
and  capacious  conduit  through  which  silver  should  immediately 
flow  from  this  country  to  England,  depriving  our  people,  notwith- 
standing the  legislative  measures  for  their  relief,  of  practically  all 
use  of  silver  as  money,  inasmuch  as  the  four  and  a  half-million 
dollars  of  Treasury  notes  would  be  withdrawn  and  canceled  about 
as  soon  as  issued. 

Thus  would  our  Treasury  Department  be  made  practically  the  pur- 
chasing agent  in  this  country  of  any  syndicate  or  combination  of 
English  merchants  who  might  desire  silver  for  the  East  India  trade. 

If  it  be  said  that  no  Secretary  of  the  Treasury  would  attempt  thus 
to  defeat  the  will  of  the  people  as  expressed  in  the  law,  the  sufficient 
reply  is  that  a  conscientious  man  who  believes  that  the  honor  of  the 
United  States  is  pledged  to  the  maintenance  of  the  gold  standard, 
and  that  it  is  indispensable  to  the  prosperity  of  the  people,  will  ex- 
ercise all  the  power  vested  in  him  by  law  to  prevent  a  departure 
from  that  standard,  and  will  regard  himself  as  for  the  time  being 
the  savior  of  the  Republic  by  keeping  it  from  "  the  edge  of  so  dan- 
gerous a  peril "  as  the  execution  of  the  people's  will. 

Certainly  no  man  will  deny  to  the  present  Secretary  of  the  Treas- 
ury entire  rectitude  of  motive  in  all  his  conduct.  From  the  well- 
known  fact  that  since  the  passage  of  the  limited  coinage  act  of  1878 
all  our  Secretaries  have  refrained  from  purchasing  more  silver  than 
they  were  compelled  to  do  by  the  mandatory  provision  of  that  law, 
it  is  reasonable  to  infer  that  none  of  them,  if  called  upon  to  execute 
a  law  containing  a  silver  bullion  redemption  clause,  such  as  is  sug- 

§ested,  would  feel  called  upon  to  make  a  net  purchase  of  more  than 
2,000,000  worth  in  each  month  ;  and  that  none  of  them  would  hesi- 
tate to  exchange  for  Treasury  notes  all  the  monthly  purchases  of 
bullion  in  excess  of  that  amount. 

A  PLANK  FROM  THE  REPUBLICAN  PLATFORM. 

I  must  be  pardoned  for  directing  the  attention  of  Senators  on  this 
side  of  the  Chamber  to  a  short  declaration  of  the  last  Republican 
National  Convention : 

The  Republican  party  is  in  favor  of  the  use  of  both  gold  and  silver  as  money. 

If  party  platforms  mean  anything  that  clause  meant  that  the  Re- 
publican party  went  before  the  country  pledged  to  the  use  and  to  the 
equal  and  non-discriminating  use  of  both  silver  and  gold  as  money. 
It  was  well  known  that  throughout  the  entire  West  the  question 


108 

of  the  remoiietization  of  silver  was  deemed  of  vital  importan  . 

orators  and   tin*  party  press,  throughout   tlint  enl 
were  severe  in  their  denunciation  of  the    prior  adn:ini>tr;i' 
its  unfriendly  attitude  toward  silver. 

I   wi.-h  in  all   solicitude  and  sincerity   to  advise  my    i; 
friends  of  tlie  Hast  tliat  this  plank  in  the    party  platform  \\  as  con- 
strued by   the  Republicans  of  the  West    to  mean    precisely  what    it 

They  arc  looking  with   confidence  to  this  L'ongre- 
aetion  as  will  fittingly  embody  in  tin- statutes  the  principle  laid  down 
by  the  party  uow  in  the  responsible  direotion  of  the  Government. 

SHALL  WK  BR  FLOODRI)  WITH  SILVER? 

We  a:-.-  told  that  if  silver  is  given  free  access  to  the  mints  we 
shall  be  flooded  with  it  from  all  parts  of  the  world.  Does  anybody 
nhow  where  the  llood  of  silver  is  to  com.-  from  T  Where  are  the  res- 
ervoirs that  contain  itT  Not  in  England,  where  it  is  diflictilt  for  th«i 
people  t  a  sufticicncy  of  it  forsmall  change  to  transact  the 

business  of  the  country  :  not  in  (Jermany.  where  tlie  scarcity  of  money 
•hat  t  he  government  had  to  abandon  the  idea 

.  t-r.  Though  the  stock  in  France  is  large  her  people  will  never 
give  it  up.  Silver  lias  hetMithe  "shield  and  buckler"  of  the  French 
Kepnhlic.  All  she  has  is  coined  at  the  ratio  of  IfvJ  ounces  of  silver  to 
1  of  gold,  and  its  sh  pment  to  this  country  would  involve  a  loss  to 
France,  not  only  oft  lie  3  percent,  difference  between  the  French  re- 
lation i  l.">*  to  1)  and  ours  (which  is  1(5  to  1),  but  of  3  per  cent,  ad- 
ditional in  thi'  cost  of  gathering  and  shipping  it.  And  after  that 
could  only  exchange  them  for  Treasury  notes.  Tlie  silver  stock  in 

md  the  ( )rient  is  performing  indispensable  duty  as  money,  and 
no  "tlood"  of  it  can  be  expected 'from  that  ipiarter.  From  time  im- 
memorial India  has  been  absorbing  all  the  surplus  silver  of  the 
world.  Sh  :•  got  so  much  as  to  appease  her  appetite  for 

lire  for  that   metal   that  she  h 

.Mown  as  the  "Sink  of  Silver."     China  has  not  a  piece  of  the 

'hat  she  can  dispose  of.    Mexico  has  no  stock  whatevei 
MT  on  hand,  except  the  limited  number  of  coin  CM!  pieces  forming  her 
modera'e  money  circulation,  and  not  a  dollar  of  it  can  be  span 
count:  -onth  America  has  any  surplus  silver.      ! 

piece  of  coined  silver  in  .-very  country  in  the  world  is  part  of  thcmon-- 

leulation  of  that  country,  and  even  when  of  short  weight  and 
classified  as  a  mere  "token"  is  passing  at  par  as  full  valued  money. 

:i  could  p..  rue.  therefore,  to  the  owners  of  col! 

.where   liy  shipping  it    t<>   this  country  for  any  purpose,   ami 

•  •  k  of  bullion  anywhere. 
If  anybody  doiibt.H  this  statement  let    him  make  the  a'tempt  in  all 

the  !!:•  :  s  of   the  world  to  Imv   from  accumulated   sto. 

•  •I"  it.     lie  will  fail  to  get  it  in  London.  l'ari>.  Uerlin, 

QOboOj  or  in  all  combined.      1 

nun  which  to  .jet    silver  except    the  current  snppi 

the  mines,  and  whatever  that  is  now  it  is  not  likely  ever  ^n-atly  to 
increajw.  The  occupation  of  mining  is  not  at  ti  active  to  main  .  and 
in  the  natuie'of  the  case  the  number  who  follow  it  will  alwaxs  be 

ants  of  uld  were  but  .1  small  band  of 

\v  era  are  destined  to   1" 
.  to  the  population.     HIM  |  not  so,  na- 

VN    the    line.       TO    the    e\e    of   the    cxpericnci-ii 

peotor  -. i \-er  minee  are  as  disceruib:.  •  he  earth  a-< 

:  .rther 
Those  who  talk,  tliei, 


109 

here  for  coinage  simply  show  their  ignorance  of  existing  conditions. 

I  may  add  that  of  all  the  shafts  that  have  been  sunk  for  silver 
mines  in  the  world  where  they  have  found  silver  croppings  on  top 
in  niuety-nine  out  of  every  hundred,  and  I  think  I  am  stating  it 
moderately,  the  veins  have  not  penetrated  the  earth,  mineralized, 
fertilized,  to  the  depth  of  50  feet,  rarely  have  they  penetrated  the  earth 
to  a  depth  exceeding  1,200  feet,  and  the  most  prolific  yield  of  silver 
mines  has  been  from  a  depth  not  exceeding  800  feet. 

The  very  fact,  Mr.  President,  that,  with  all  the  world  searching 
for  gold  and  silver  mines — a  search  that  has  continued  throughout 
all  history — the  amount  of  the  two  metals  yielded  by  the  mines  is 
about  equal,  shows  that  the  historical  relation  existing  between  them 
is  the  relation  at  which  they  can  be  profitably  produced. 

It  is  apparent  that  if  therp  were  a  great  advantage  in  the  produc- 
tion of  silver  over  gold,  at  the  relation  of  15£  to  1,  that  advantage 
would  be  seen  in  the  largely  preponderant  production  of  silver; 
but  instead  we  find  that  the  result  of  thousands  of  years  of  mining 
has  given  us  about  equal  quantities  of  both  metals. 

CAN  THE  UNITED  STATES  ALOXE  HOLD  THE  METALS  AT  A  PARITY  ?   , 

We  are  told  that  the  United  States,  unaided,  can  not,  if  it  would, 
restore  silver  to  a  parity  with  gold — that  no  one  nation  acting  alone 
can  achieve  so  difficult  a  feat.  But  it  is  incapable  of  denial  that 
throughout  all  vicissitudes  of  production  of  gold  and  silver  from 
Ie03  to  1873  the  law  of  France — one  nation  alone — accomplished  it. 

As  I  have  shown  in  greater  detail  elsewhere,  by  reference  to  the 
table  of  annual  production  of  the  metals,  it  will  be  observed  that 
from  1803  to  1820,  the  production  was  in  the  proportion  of  four  dol- 
lars of  silver  to  one  of  gold ;  from  1821  to  1840  two  of  silver  to  one 
of  gold,  from  1841  to  1850  one  dollar  of  silver,  to  one  of  gold,  from  1851 
to  1860  four  dollars  of  gold  to  one  of  silver,  from  1861  to  1865  three 
of  gold  to  one  of  silver,  from  1866  to  1870  two  of  gold  to  one  of  silver, 
in  1871  and  1872  one-and-a-half  of  gold  to  one  of  silver.  Notwith- 
standing these  extreme  variations  in  the  relative  annual  production 
the  law  of  France  constituted  a  ligature  sufficient  to  hold  the  metals 
in  line  at  the  ratio  of  15^  to  1,  and  this  not  for  France  alone  but 
for  the  whole  world.  If  that  period  does  not  offer  sufficient  proof  of 
the  power  of  law,  under  varying  conditions  of  supply,  to  tie  the 
metals  together  and  keep  them  so,  no  degree  of  proof  will  suffice, 
for  the  vacillations  of  their  relative  production  have  been  greater 
during  this  century  than  at  any  former  period  in  the  history  of  the 
world. 

IS  AN  INTERNATIONAL  AGREEMENT  NECESSARY? 

If  that  could  be  done  by  a  nation  with  a  population  of  25,000,000 
to  35,000,000,  what  difficulty  could  be  experienced  by  a  nation  of 
65,000,000  in  accomplishing  the  same  result  ?  Yet  we  are  told  that 
international  agreement  is  necessary  to  restore  silver  to  its  ancient 
right  as  a  full-money  metal.  Those  who  suggest  such  an  agreement 
forget  that  while  this  nation  is  a  borrower  of  money,  the  first  and 
principal  nation  to  demonetize  silver  is  the  greatest  money  lender 
known  to  history.  Is  it  for  a  moment  to  be  supposed  that  the  shrewd 
English  creditor  classes  will  enter  into  any  agreement  which  will 
deprive  them  of  the  spoils  of  so  delicate  and  ingenious  a  system 
of  usury,  a  system  not  only  not  banned  by  law,  but,  on  the  contrary, 
having  the  special  approval  and  protection  of  statutes,  and  the  active 
support  and  approval  of  all  the  complaisant  moralists,  philosophers, 
and  financiers  of  the  age  ? 


110 

• 

While  they  are  dilligently  gathering  in  the  proceeds  of  this  opera- 
tion a  diversion  is  kept  up  for  the  occupation  and  amusement  of 
dilcttant  financiers  and  economists,  by  invoking  a  di.-scns.sion  of  the 
ratio  that  should  be  maintained  between  the  metals.  The  ratio  is 
the  pretext  on  which  conference  after  conference  has  been  call.'. I. 

The  advocates  of  the  single  gold  standard  contend  that  hostile 
legislation  had  no  influence  in  effecting  the  separation  of  the  :• 
and  that  the  reversal  of  that  legislation  can  not  and  will  not  restore 
tin-in  to  a  parity  unless  the  principal  commercial  nations  of  the 
m  world  join  in  the  work  of  rehabilitation.  An  illnstrathi^ 
the  force  of  law  on  the  relation  of  the  metals  I  will  r  ..-stive 

:aph  from  the  report  of  the  Royal  Commission  of  England 
(18«6),  Part  I,  section  1U2 : 

Now,  undoubtedly,  the  date  which  forms  the  dividing  line  between  an  epoch 
of  approximate  fixity  in  the  relative  value  of  gold  and  silver,  and  one  of  marked 
iuntability.  is  the  y*>'ar  when  the  bimetallic  s\>t.-ni  w  Mrli  had  j>r«  vimish  1><  en  in 
turcr  in  the  Latin  I'nion  ceased  to  be  in  full  operation,  and  vr  ,uv  in.-.siMilily  i.-.l 
:••  tin-  conclusion  that  the  operation  of  that  system,  established  as  it  watt  in  coun- 
tries tin-  ]>»pulai  ion  and  commerce  of  which  w  ere  considerable,  exerted  a  n 
influence  u|>on  thi>,  relative  value  of  the  two  me  taU. 

So  '..iiij.-  as  that  system  was  in  force  we  think  that.  DOtwitiutendfau  tin1  changes 
in  tin-  |iioiliirtion  and  use  of  the  preoioas  met  ids.  it   kept  tin-  market  pi;. 
ver  approximately  steady  at  the  ratio  fixed  by  law  between  ili.-ri.  namely,  15.4  to 
1.     Nor  does  it  appear  to  us  a  priori  unreason  able  to  suppose  that  the  .  \ 
in  the  Latin  Union  of  a  bimetallic  system  with   a  ratio  of  15J  to  1  fixed  i- 

0  metals  should  have  been  capable  of  keeping  the  market  price  of  .silver 
at  approximately  that  ratio. 

The  paragraph  quoted  ascribes  the  effect  thus  produced  to  the  hi- 
inrtallic  treaty  of  the  Latin  Union,  a  combination  of  Italy,  Belgium, 
Switzerland,  and  France,  entered  into  in  1865  for  the  purpose  of 
maintaining  similar  conditions  of  coinage.  But  it  will  he  observed 
that,  so  far  as  the  ratio  was  concerned,  precisely  the  same  i-fi. 
been  produced  by  France  alone  during  the  sixty-two  years  from  the 
passage  of  its  law  of  1H03  to  1865. 

Not  only  did  the  French  law  keep  the  metals  together  at  n  time 
when  the  larger  annual  yield  was  of  silver,  but  it  kept  them  to- 
gether when  the  larger  annual  yield  wasof  gold.  Had  not  that  law 
been  in  operation  during  the  'no's,  when  a  ilood  of  gold  poured  from 
the  mines  of  California  and  Australia,  gold  would  have  fall* •; 

early  ti s  it  more  than  once  fell,  to  the  ratio  of  1  to  10,  at  which 

Imt  in  ounces  of  silver  (instead  of  15^)  would  buy  an  ounce  of  gold. 
Tli  us  the  law  of  one  country  alone,  a  country  then  of  not  one-half 
the  present  population  of  the  United  States,  held  the  metals  to- 
gether, s.i  that  to  whatever  extent  gold  fell  in  relation  to  commodi- 
ties from  1H48  to  1865,  by  reason  of  the  larj;e  output  of  the  mines. 
:.-ll  to  the  same  extent,  notwithstanding  tin*  enormous  de- 
crease in  its  production  relatively  to  gold  during  that  p' 

Mimed  for  law  in  this  connection  is  nut    that    it   directly 
MS  the  relative  values  of  gold  ami  silver  any  more  than  of  any- 
thing else,  but  Ahut  mi  the  Mlightesi  i  of  the  ni.-tal 
instantly  Arises,  under  the  law  of  1  he  double  standard,  a  demand  for 
the  cheaper  metal,  while  |  he  demand  for  t  In-  dearer  on.   is  siis;. 

In  this  way  the  double  standard  accomi late*  itself  to  tin 

supply  and  demand,  which  is  adm  it  ted  to  IM-  t  In- governiiii:  1. 1.  tor  in 
nation  <•(  \alne.     It  in  not  contended   that  a  Minall  or  in- 

"ild  keep  the    metals  together,  but 

oes  to  show  that  a  great  nation  like  the  United  States  would 
have  no  difficulty  w1  i  »o. 

80  thoroughly  are  the  advantages  of  the  gold  standard  • 


Ill 

creditor  classes  recognized  in  England  that  the  English  Commis- 
sioners, who,  for  form's  sake,  have  been  sent  to  the  several  monetary 
conferences  held  on  the  continent,  have  never  been  invested  by  their 
Government  with  any  power  whatever.  And  it  is  but  a  few  weeks 
since  the  House  of  Commons  overwhelmingly  voted  down  a  proposi- 
tion made  in  good  faith  by  Mr.  Samuel  Smith,  looking  to  the  calling 
of  a  new  conference,  which  was  supported  by  petitions  to  Parlia- 
ment signed  by  60,000  persons  not  merely  as  individuals,  but  as  rep- 
resenting large  organizations  of  the  toilers  of  England. 

The  ratio  is  not  the  difficulty.  Those  who  wanted  silver  demone- 
tized do  not  want  it  added  to  the  money  volume  of  the  world  at  any 
ratio.  Why  then  shall  we  wait?  Macauley,  commenting  on  the 
impregnability  of  intrenched  prerogative,  observed  that  if  the 
announcement  of  the  discovery  of  the  law  of  gravitation  had  mili- 
tated against  the  personal  interests  of  any  vested  or  privileged 
class,  its  general  acceptance  might  have  been  long  postponed. 
Shall  we,  then,  postpone  relief  to  the  suffering  industries  of  this 
country  till  we  can  secure  from  the  privileged  classes,  from  the 
money-lender's  of  the  world,  an  agreement  to  cease  their  exactions  ? 

No,  Mr.  President,  we  need  not  wait,  and  we  will  not  wait.  All 
that  is  necessary  is  to  act,  and  so  far  as  the  rules  of  order  and  of  par- 
liamentary procedure  will  permit,  we  propose  to  act,  promptly  and 
decisively.  The  world  can  not  expect  the  initiatory  movement  for 
any  change  to  be  taken  by  those  whose  interests  are  served  by  the 
continuauce  of  presentconditions.  Such  conditions  being  consistent 
with  their  own  welfare,  they  find  no  difficulty  in  arriving  at  the 
conclusion  that  they  are  for  the  welfare  of  society  at  large. 

The  dogma  that  cupidity  is  a  synonym  for  virtue  will  never  fail  to 
find  ready  converts  among  the  beneficiaries. 
*    *    *    Plate  sin  with  gold, 
And  the  strong  lance  of  Justice  hurtless  breaks. 

CONCLUSION. 

I  predict  that  the  restoration  of  silver  to  its  birthright,  Mr.  Pres- 
ident, will  mark  an  epoch  in  the  history  of  this  country.  It  will 
place  in  circulation  an  amount  of  money  commensurate  with  our 
increasing  population.  It  will  give  assurance  to  our  languishing 
industries  that  the  volume  of  our  circulating  medium  is  not  to  con- 
tinue shrinking,  an.d  that  the  tendency  of  prices  shall  no  longer  be 
downward.  It  will  increase  the  wages  of  labor  and  the  prices  of 
the  products  of  labor ;  it  will  reduce  the  price  of  bonds  and  other 
forms  of  money  futures,  it  will  lighten,  but  not  inequitably,  the 
burden  of  mortgages;  it  will  increase  largely,  though  not  unjustly, 
the  debt-paying  and  tax-paying  power  of  the  people.  It  will  loosen 
the  grasp  of  the  creditor  from  the  throat  of  the  debtor. 

By  the  remonetization  of  silver,  money  will  cease  to  be  the  object 
of  commerce,  and  will  again  become  its  beneficent  instrument.  Ac- 
tivity will  replace  stagnation,  movement  will  supplant  inertia,  cour- 
age will  banish  fear ;  confidence  will  dispel  doubt ;  hope  will  super- 
sede despair. 

The  lifting  up  of  silver  to  its  rightful  plane  by  the  side  of  gold 
will  set  in  motion  all  the  latent  energies  of  the  people.  It  will  banish 
involuntary  idleness,  by  putting  every  willing  man  to  work.  It  will 
revive  business,  and  reanimate  the  heart  and  hope  of  the  masses. 
Capital,  n&  longer  fearing  a  fall  in  prices,  will  turn  into  productive 
avenues.  The  hoards  of  money  lying  idle  in  the  bank  vaults  will 
come  out  to  bless  and  enrich  alike  their  owners  and  the  community 


112 

at  large;  while  the  millions  of  dollars  now  invested  at  low  interest 
in  gilt-edged  securities  will  seek  more  profitable  investment  in  the 
busy  field  of  industry,  where  they  will  be  utilized  iu  the  payment 
of  wages  and  the  constituent  dissemination  of  comfort  and  happi- 
ness aniMiig  the  people. 

And  urn  it  will  accomplish  not  for  the  United  States  alone,  but 
for  civilization.  For  it  is  not  too  much  to  say,  Mr.  President,  i  hat 
upon  the  decision  of  this  question  depend  consequences  more  mo- 
mentous than  upon  that  of  any  other  question  of  public  policy  with- 
in the  memory  of  this  generation.  In  a  broader  sense  than  any  other- 
question  attracting  the  general  attention  of  mankind  it  is  a  ques- 
tion of  civilization.  It  embodies  the  hopes  and  aspirations  oi  our 
race. 

The  act  of  Congress  which  shall  happily  solve  it  will  constitute 
a  decree  of  emancipation  as  veritable  as  any  that  ever  freed  serf 
from  thraldom,  but  more  universal  in  its  application.  It  will  pro- 
claim the  freedom  of  the  white  race  the  world  over,  it  will  lift  the 
bowed  head  of  labor,  it  will  hush  the  threnody  of  toil.  It  will  in- 
augurate the  true  renaissance — a  renaissance  of  prosperity,  without 
which  industry,  learning,  science,  literature,  art,  are  but  as  apples 
of  Sodom.  (Applause  in  the  galleries.) 
JONES 


N 

INDEX 


Pago. 
Alison,  Sir  Archibald,  coinage  has  no  effect  in  preventing  fluctuations  in 

value  of  coin 42 

effect  of  suspension  of  specie  payments  in  England 

in  1797 ". 78 

Allegory  of  the  clocks  50 

American  Review,  effect  of  increasing  volume  of  money 8 

Automatic  system  of  money,  gold  and  silver 9 

why  interfered  with   18 

Appleton's  Cyclopedia,  definition  of  money 67 

Aristotle  onMoney. 66 

Balance  ot  trade,  the  argument  based  on 96 

Banker's  advice  to  the  Usurer 70 

Baring,  Alexander,  a  reduction  of  paper  would  have  the  same  effect  as  of 

any  other  money 78 

Bastiat,  description  of  the  crown  piece 68 

Bandeau,  on  Money 66 

Behren,  Jacob,  opinion  as  to  effect  of  gold  standard  in  England 23 

Berkeley,  Bishop,  queries  as  to  Money  67 

Best  Money  (truthfully  so-called),  a  money  of  unchanging  value  in  the  unit.  70 

Cairnes,  Prof.  J.  E.,  relations  of  paper  currency  to  foreign  exchange 98 

Cattle,  estimate  of  value  iu  1880  '      4 

Cernnschi,  the  purchasing  power  of  money  is  in  direct  proportion  to  the 

volume  of  money  existing 77 

Checks  and  clearing  houses,  their  effects  in  economizing  use  of  money,  con- 
sidered    46 

Chevalier,  in  France,  advocated  demonetization  of  gold  20 

Circulation,  present  monetary 75 

Coal,  yield  for  1888 4 

Condition  of  country  at  present 1 

at  period  of  demonetization  of  silver  26 

Competition,  the  value  of  money  fixed  by  the  competition  to  get  it 73 

Cotton  manufacturer,  his  loan 'of  $10, OO'O,  payable,  principal  and  interest,  in 
cloth,  contrasted  with  loan  of  same  amount  c.ontracted  by  his  neighbor, 

but  payable  in  dollars , 72 

Cotton-planters,  their  loss  by  demonetization  of  silver 60 

Crawford,  William  H.,  opinion  as  to  effect  of  decreasing  volume  of  money.  7 
Creditors,  demand  for  the  "Best  Money,"  meaning  a  money  of  increasing 

value 69 

their  course  in  Europe  to  increase  value  of  gold 19 

their  course  in  United  States  to  increase  value  of  gold  27 

the  pretense  in  the  United  States  to   "strengthen  the  public 

credit" 28 

Crops  for  1888,  corn,  wheat,  oats,  and  cotton  4 

Debt,  a  distinguishing  characteristic  of  civilization    35 

a,  of  $10, 000  contracted  in  1873— how  much  wheat,  cotton,  etc.,  would 

pay  it  then  and  how  much  now 57 

Debtors,  who  are  they 35 

and  creditors,  their  motives  compared 34 

De  Colange,  Professor,  the  rate  at  which  money  exchanges  is  determined  by 

its  quantity 77 

Demand  for  money,  what  it  is 73 

Demonetization  of  silver,  by  England 22 

by  Germany 16 

by  United  States 28 

wholly  unjustifiable 28 

De  Qnincey,  in  England,  advocated  demonetization  of  gold 20 

Difficulty,  one  symptom  common  to  all  industries 5 

Discussion,  educational  effect  of 29 

Double  standard,  statement  of,  before  French  Commission 22 

JONES 8  113 


114 


Dnmaa,  a  Senator  of  France,  pleads  for  caution  before  demonetization  ......  IT 

KI-I  iiniiii  iHt  (  London)  admits  ri»e  of  told   ..................................  44 

Effects  of  shrinking  volume  of  money  (extract  from  repot  t  of  Monetary 

(  '.mi  in:  is  ion)   .............................................................  36 

Kneyrloprdia  Brilannica,  effect  of  fall  in  the  value  of  money  ................       8 

BnfttM  8  position  not  due  to  gold  standard  ................  ".  ...............  25 

Fa-lure*  in  United  Slates,  18X7.  1888.  and  1889  ...............................  -i'.i 

Fall  of  interest  on  gilt-edged  securities,  a  proof  of  rise  of  gold  ...........  •.  .  4X 

Farm,  how  it  may  !>••  lost  by  an  increasing  value  In  the  money  unit  ........  70 

Farmer*,  their  l«s  l»y  demonetization  of  silver  .............................  60 

Farms,  estimate  of  value  in  1880  ......................................  ......  4 

proposition  that  the  Government  lend  money  on  the  security  of  the 

land   ....................................................              ...  S3 

Fanchet,  Leon,  probable  effect,  should  all  European  nations  follow  F.n-lmd 

in  discarding  silver  .......................................................  J7 

Firlite,  the  value  of  money  depends  on  Its  quantity  .........................  76 

Flood  ofmlver.  where  \*  it  to  come  from  f    .................................  108 

France,  law  of  1903  held  metals  at  a  parity  till  1873    ____  ...................  1<> 

Frewen.  Moreton,  extract  from  his  "Economic  Cri*i-»"  .....................  MO 

Gallatin,  Albert,  a  metallic  currency  not  indispensable  ..................... 

German  v.  emigration  from   ...................         ..........................  25 

Gibbs,  Henry  II.,  cablegram  relating  to  bimetallism  ....................  29 

Giften,  Kobert.  his  reasoning  erroneous  that  the  commodity  demand  fixes  the 

value  of  void  .............   .............................  '.  ..................  81 

Gold  and  silver,  both  variable  in  value  ....................................  41 

the  world's  supply  of  both  ................................  101 

Gold,  ratio  of,  to  silver  at  various  periods  —  ...............................  13-16 

fall  of,  during  timea  of  Alexander  and  Cirsar..  .........  .  ..............  14 

fear  of  fall  of.  during  California  excitement  ...........................  19 

rise  of  from  1873  to  1889.  ..............................................  44 

proof  that  it  has  rinen  .........  .  .......................................  55 

tome  effect*  of  its  rise  .................................................  ,s" 

proposition  first  made  to  demonetize  it  ..................  .  .............  19 

demonetized  in  1857  by  German  States  aii«l  Austria  ...................  20 

fear  of  an  outflow  of  ..............  .  ...................................  85 

rationale  of  the  outflow  of  ............................................  86 

value  as  money  not  derived  from  commodity  use  .....................  81 

Goschcn,  George  J.,  chancellor  of  exchequer  of  England  speaks  for,  but  de- 

cides against,  silver   .....................................................  24 

Graham,  Sir  Jimes,  the  value  of  moneyisin  the  inverse  ratio  toils  quantity.  77 

"Greenback",  the,  what  tave  it  value  f    ..................................  105 

Gresham's  law,  and  so-called  "extension"  of  ..............................  08 

Gold  standard,  what  it  implies  ..........................................  00 

statement  in  behalf  of,  before  Frein  li  OOmmJaatoa  ........ 

of  the  future  ................................................  91 

Gold  nsed  In  the  arts  .....................................................  luS 

(Mild  money,  practically  none  in  the  ITnit<-d  States  .........................  9ft 

Hamilton,  Alexander,  effect  ot  annulling  UM  •  »f  either  metal  ...............  in 

1  louses  I  n  I  niie.l  State*,  estimated  value  in  1880  ............................  4 

Hume,  David,  contract  of  conditions  under  increasing  and  under  dccitasing 

volume  of  money  .........................................  7 

ralue  of  monev  depend*  on  quantity  .....  ...............  70 

Hnsklaaon.  William,  if  the  quantity  of  money  is  ini-reavd  the  value  of  com- 

uiodlttna  Increase  ......................................................  77 

Improved  method*  of  product  Ion,  thrir  ••nVcts  considered   ..................  45 

India,  will  rr-nionetization  place  us  "alnn  :«ii|i  '     ......                          ......  82 

Int'-itiatlonal  agreement:  Is  such  agreement  necessary  to  tic  tin-  metals  to- 

f«lb»T                        .......................................   ............  109 

InrolwitarY  MiMMn,  enormous  lou  of  potential  wealth,  through  ...........  01 

Iron,  pig  :  VleW  for  1888   ..............                                            .............  4 

Jffferson,  Thomas,  "the  unit  nniot  stand  on  lioth  metsls  "  .................  17 

Jevona,  Professor:  The  i                      i  steady  a  standard  st  corn  ...........  42 

inconvertible  paper  money,  if  limited  in  quautity,  can 

retain  its  full  value  .............................  ......  ~~ 

Jc  vnna,  on  Money  ......................................................  06 

Ublitof  relation  nf  general  r>ri<v«i  18)0  to  I8iD  ....................  40 

LatighUn,  I'rofeocor.  -the  name  'dollar'  doea  not  always  have  the  same 

value"  ..............................................                                      .  42 

I.ar<  l«ye,  Prufensnr.  ••  Debtors  have  a  right  to  pay  In  gold  or  silver"  ........  1M 

L»w,  what  IscUlrord  for  it.  In  kc.  ]•  n.-  id.  i.n-iHl.  •                               ........  110 

ot  France  held  the  metals  together  frwui  IboJ  till  d<.uiuuiUtation  ......  1.0 


115 


Legal  -tender  :  All  money  should  have  this  power  ..........................  71 

Locke,  John,  both  gold  and  silver  variable  in  \alue  .........................  4- 

on  Money  ..................   ..................................  66,  76 

McCulloch,  J.  K.,  "  Monev  is  a  measure  of  value"  ..........................  71 

•were  there  perfect  security  against  over-issue  of  paper 

money,  the  metals  might  be  dispcns.  d  with  .............  78 

McLeod,  on  Money  .........................................................  66 

Materials  used  as  Money  at  various  epochs  .................................  10 

Machiavelli's  reference  to  the  brisianils  ..................................  57 

Massachusetts  Bureau  of  Labor  :  Deductions  from  its  reports  as  to  numbers 

of  the  unemployed   ..................  ...............................  61 

Mill,  James,  the  vulue  of  money  depends  on  its  quantity  ...................  76 

Mill,  John  Stuart,  on  Money    ..................  ............................  66 

the  value  varies  inversely  as  its  quantity  ................  76 

Mining  States  :  Their  interest  in  i  emonetization  of  silver  ............   ----  58 

Monetary  Commission  Report  :  Quotations  from,  as  to  new  school  of  finan- 

cial theorists  .....  ...  ....................................................  18 

Money  demand,  not  commodity  demand,  gives  gold  its  value  ................  81 

effect  of  reduction  in  volume  of  ......................................  6 

effect  intensified  as  civilization  advances  ...........  ..  ...............  6 

a  glance  at  the  history  of.  ...........................................  9 

substances  used  as,  at  various  epochs  ...............................  10 

the  money-function  tneall-sufnciein  guaranty  of  the  money  value  ----  79 

where  is  the  future  money  to  come  from,  if  silver  remains  demone- 

tized ...........................................................  79 

—  what  is  it  ?    Its  value  not  in  the  material  but  in  the  stamp  —  in  the 

legal-tender  power  conferred  .....................................  65 

ehonld  be  redeemable  in  all  things  .................................  101 

valuable  rather  for  the  important  service  it  performs  than  for  the 

material  of  which  made  .....................  .  ....................  80 

question  a  question  of  prices  ...........  ...........................  80 

what  is  the  demand  for  it?  what  the  supply  ?  ......................  73 

no  alternative  for  it  .............................................  74 

the  most  potent  instrumentality  in  the  evolution  of  society  ........  74 

National  money,  as  distinguished  from  international  money.    Advantages 

of  national  money  .........................................................  09 

Newspapers,  number  published  in  United  States  ...........................  4 

Non-mining  States,  their  interest  in  remonetization  of  silver  ...............  60 

Overstone,  Lord,   "  The  value  of  a  paper  currency  results  from  its  being 

kept  at  the  same  amount  the  metallic  currency  would  have  been  "  .......  78 

Panics,  impossible  if  all  money  were  le<tal  tender  ..........................  71 

Parity  of  the  metals:  Can  the  United  States  alone  hold  them  together  1  ...  109 
Panlus  (author  of  Pandects):  Power  of  money  dependent  not  on  substance 

but  on  quantity  .....  .  .........................................         ........  77 

Playfair,  Sir  Lyon,  uses  the  argument  that  England  is  a  creditor  nation  ____  23 

Population.  Money  should  increase  in  a  ratio  not  less  than  the  ratio  of  in- 

crease of  .................................................................  75 

Price,  the  index  of  the  value  of  Money  .....................................  8 

Price,  Bonanay,  on  Money  .......  ........................................  ..  67 

Prices,  what  produces  a  general  fall  of  .......  ..  ............................  5 

fall  of,  in  United  States  since  1-73  ................................  ,.  38 

relation  of  general  prices,  1£09  to  1  849,  Jevon'a  tables  ...............  40 

relation  of  general  prices,  1849  to  1883,  Soetbeer's  tables  .............  41 

Progress,  evolutions  of,  in  Money  ...    ................  .  .....................  9 

Prophecies  of  gold  advocates  unfulfilled  .....................  ..  ............  30 

Protect  ion,  its  effect  on  prices  ..........  .....................................  88 

Quantitative  theory  of  Money.    The  value  of  each  dollar  depends  on  the 

n  umber  of  dollars  out  ....................................................  75 

Railroads,  number  of  miles  in  United  States  ............................  4 

value  in  1880  .................   .....  ...........................  4 

Ratio  of  precious  metals  from  earliest  times  to  Christian  Era  ..............  13 

Christian  Era  to  discovery  of  America  ......  14 

discovery  of  America  to  1822  .................  15 

1823  to  1889  ..................................  16 

Kicardo,  use  of  the  metals  as  i  standard  ....................................  43 

the  value  of  money  in  a  country  depends  on  the  amount  existing..  76 

there  can  be  no  depreciation  of  money  but  from  excess  of  quantity.  76 

his  views  as  to  a  "  well  regul  .ted  paper  currency"  ................  78 

Rothschild,  Baron,  opinion  of  bimetallism  ...............................  17 

Houland,  M.,  governor  of  Bank  of  France,  opposed  to  demonetization  ......  17 

JONES 


110 

Royal  Commission  of  England,  extracts  from  report  "f    

i. those  of  1;-S7  the  K»weM   for  one  hundred 

liar,  the  92 

'nine 8 

Silver,  latio  of.  to  gold,  at  vari-ms  periods 13-16 

.iied  until  tn  !>••  11  ted  ;IM  money 

objections  to.  eonsidi-ied 'Jl 

the  m.  live  tor  demon  cluing,  by  Kn-_'land 21 

the  motive  for  demonetizing,  by  (Jut  many 24 

the  mot  i  vi-  at  know  led  ged 23 

and  gold  both  variable  in  value 41 

— ban  it  fallen  J.                                     «!> 

pun-basing  power  in  1873  «nd  1839 02 

prejudice  against  it  as  moiie\  arising  from  the  idea  thnt   cold  money 

hat  great*  r  "  intrinsic  value,"    That  <|ue»iion  considered 

•hall  we  be  il  oded  with  it  in  case  of  ruuoneiizaiiouf lu.-i 

tin'  world's  supply lul 

If  $2,500.000  a  month  for  twelve  years  has  not  driven  out  gold.  ' 

much  will  do  HO  I   ". ' 91 

Silver  miners,  their  loss  by  demonetization  contrasted  with  that  of  farmers 

i.;  l  on -planters 

Smith,  Adam:  Itoth  gold  and  silver  variable  in  value „..  41 

Definition  of  a  guinea 66 

•  r's  table,  showing  relation  of  gent  ral  ptio-H  iHi'.i  in  1«>.~>    41 

Standard:  The  tiue  Money  standard  not  the  manual  of  which  money  is 

.    .' 7* 

Stewart,  Dugald.on  Money 67 

'. 4 

Sun  idea  in  Germany 25 

Sii|  jilv  of  money,  what  it  is 73 

:  n  standard  suggested  for  time  contracts  as  securing  greater  equity 

il  an  «old .".  43 

Tin  niton,  Henry,  on  Money 66 

la,  their  importance  to  indnstry 5 

•  -is:  The  value  of  gold  linen  or  tails  as  its  quantity  is  diminished  or  in- 

•  •I 77 

ild  UCt  be  redeemable  in  bullion 104 

-M,  li  led. -miiti-m       106 

;..  fall  of  prices 89 

tile     61 

;  inn  of  silver  effected  in  1873 -il 

7n 

Wall,  i                             ; 

Value,  the  meaning  of     63 

(>:( 

04 

ml  in  the  inati  ii.il.  lmt  in  tin-  stamp— in  the  pov  < 

t.lltlel    63 

IHOIH-N  a  measure  t-                      ..  71 

>m  earliest  times  13 

.•m  from  m\ol!ir,ttir\  idleness  enoi  THUMB 62 

Walker,  1'rof.  F.  A....II  M..II.-\ ..66,«7 

gold  and'silvi  r  Ix.ih  variable  in  vab                                  ..  42 
the   vain. 

H 77 

Wealth,  nalinnnl.  e-i                                      : 

i /.at  inn     .  17 



i>  Imgtheotd,  "  lung  in  "  un  ti ..                                             73 

J  i  .  M  .1 


University  of  California 

REGI?NAL  "•"* FACIUTY 

tK?6'  ^  ^fl6168'  CA  90024-1388 
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